Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities
Act. x Yes ¨ No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the
Act. ¨ Yes x No

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months, and
(2) has been subject to such filing requirements for the past 90
days. x Yes ¨ No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule
405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such
files.) x Yes ¨ No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrants knowledge, in
definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ¨

Indicate by check mark whether registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.
See the definitions of these terms in Rule 12b-2 of the Exchange Act.

Large accelerated filer

x

Accelerated filer

¨

Non-accelerated filer

¨

Smaller reporting company

¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the
Act). ¨ Yes x No

On March 31, 2011, the aggregate market value of the Common Stock held by non-affiliates of registrant was $3,688,198,124. This figure excludes the Common Stock held by registrants Directors
and Corporate Officers, who are the only persons known to registrant who may be considered to be its affiliates as defined under Rule 12b-2.

Number of shares of Common Stock, $.01 par value, outstanding as of December 6, 2011: 55,179,259.

DOCUMENTS
INCORPORATED BY REFERENCE

Certain portions of the registrants definitive proxy statement for its annual meeting of shareholders, to
be filed with the Securities and Exchange Commission within 120 days after September 30, 2011, are incorporated by reference into Part III of this report.

Forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of
the Securities Exchange Act of 1934, are made throughout this report. These forward-looking statements are sometimes identified by the use of terms and phrases such as believe, should, expect, project,
estimate, anticipate, intend, plan, will, can, may, or similar expressions elsewhere in this report. Our results of operations and financial condition may differ
materially from those in the forward-looking statements. Such statements are based on managements current views and assumptions, and involve risks and uncertainties that could affect expected results. Those risks and uncertainties include but
are not limited to the following:



our ability to effectively manage the growth from acquisitions or continue to make acquisitions at the rate at which we have been acquiring in the
past;



significant increases in the costs of certain commodities, packaging or energy used to manufacture our products;



our ability to continue to compete in our business segments and our ability to retain our market position;



our ability to maintain competitive pricing, successfully introduce new products or successfully manage costs across all parts of the Company;



significant competition within the private-brand business;



our ability to successfully implement business strategies to reduce costs;

the possibility that the combined post-separation value of Ralcorp and Post shares may not equal or exceed the pre-separation value of our common
stock;



potential liabilities that may arise due to fraudulent transfer considerations surrounding the separation of the Post cereals business;



significant tax liabilities that could arise as a result of the separation of the Post cereals business; and



tax restrictions that may prevent us from engaging in certain corporate transactions or from raising equity capital beyond certain thresholds for a
period of time after the separation of the Post cereals business.

These factors should not be construed as exhaustive and
should be read in conjunction with the other cautionary statements included in this document. These risks and uncertainties, as well as other risks of which we are not aware or which we currently do not believe to be material, may cause our actual
future results to be materially different than those expressed in our forward-looking statements. We do not undertake to update our forward-looking statements, whether as a result of new information, future events or otherwise, except as may be
required by law.

Our strategy is to grow our businesses, primarily through the acquisition of other companies. In addition, we seek to increase sales of
existing and new products and expand distribution to new customers and new geographic areas. In addition to our 2008 acquisition of the Post branded cereal business, since 1997, we have acquired more than 25 companies that manufacture private-brand,
regional-brand or value-brand food products.

The following sections of this report contain financial and other information
concerning our business developments and operations and are incorporated into this Item 1:



Managements Discussion and Analysis of Financial Condition and Results of Operations under Item 7; and



Business Combinations, Supplemental Earnings and Cash Flow Information, Goodwill and Segment
Information in the Notes to the Consolidated Financial Statements filed as part of this document under Item 8.

You can find additional information about us, including our Forms 10-K, 10-Q, 8-K, other securities filings (and amendments thereto), press releases and other important announcements, by visiting our
website at ralcorp.com or the SECs website at sec.gov for securities filings only, from which they can be printed free of charge as soon as reasonably practicable after their electronic filing with the SEC. Our Corporate Governance Guidelines,
Standards of Business Conduct for Officers and Employees, Director Code of Ethics, and the charters of the Audit and Corporate Governance and Compensation Committees of our board of directors are also available on our website, from which they can be
printed free of charge. All of these documents are also available to shareholders at no charge upon request sent to our corporate secretary (P.O. Box 618, St. Louis, Missouri 63188-0618, Telephone: 314-877-7046). The information on our website is
not part of this report.

RECENT BUSINESS DEVELOPMENTS



On July 14, 2011, we announced that our board of directors had agreed in principle to separate Post Holdings, Inc., an entity that will own the
Post cereals business, from our other businesses in a tax-free spin-off to our shareholders. At the same time, we announced that upon completion of the separation, William P. Stiritz, our chairman, will become chairman of the new Post entity and J.
Patrick Mulcahy, who was appointed our vice chairman, will become chairman of our board of directors. In addition, we announced that David P. Skarie, our co-chief executive officer and president, will retire from the Company effective
December 31, 2011, at which time Kevin J. Hunt, our co-chief executive officer and president, will become chief executive officer and president.



On August 12, 2011, we announced that our board of directors had rejected an unsolicited proposal by ConAgra Foods, Inc. to acquire our company
for $94.00 per share in cash, a decision that we reiterated on September 19, 2011, after careful consideration and with the assistance of our financial and legal advisors. ConAgra Foods withdrew its proposal on September 19, 2011.



On September 26, 2011, we filed a Form 10 with the SEC related to the anticipated separation of the Post cereals business.

On September 26, 2011, we announced that William P. Stiritz will also serve as Chief Executive Officer of Post Holdings. We also announced that
James L. Holbrook joined Post Holdings as Executive Vice President, Marketing, effective October 3, 2011.



On September 27, 2011, we announced that Thomas G. Granneman, our chief accounting officer, will retire effective December 31, 2011, at which
time Scott Monette, our treasurer and chief development officer, will become chief financial officer.



On October 3, 2011, we acquired the North American private brand refrigerated dough business of Sara Lee Corp., a leading manufacturer and
distributor of a full range of private brand refrigerated dough products in the U.S., with operations in Carrollton, Texas and Forest Park, Georgia. At the same time, we entered into a short-term financing arrangement that we expect to repay with a
portion of the proceeds generated by financing to be incurred in connection with the separation of the Post cereals business.



On October 13, 2011, we announced the appointment of Robert Vitale as Chief Financial Officer of Post Holdings, effective November 1, 2011.



On November 11, 2011, we announced the appointment of Terence E. Block as President and Chief Operating Officer of Post Holdings, Inc, effective
January 1, 2012.



On November 18, 2011, we announced the appointment of Barry Beracha and Patrick Moore to our Board of Directors, effective upon the separation of
the Post cereals business.

The Branded Cereal Products segment is our Post® brand ready-to-eat cereals business, which includes Honey Bunches of Oats®, the third-largest brand of ready-to-eat cereal in the United States, by revenue.

The Frozen Bakery Products segment includes private-brand and value-brand frozen griddle products, including pancakes, waffles and French toast, frozen
biscuits and other frozen pre-baked products such as breads and rolls, and frozen doughs, as well as refrigerated doughs since the acquisition of the North American private brand refrigerated dough business of Sara Lee Corp. on October 3, 2011.

We develop, manufacture, and market emulations of various types of branded food products that retailers, mass merchandisers and drug
stores sell under their own store brands or under value-brands. We attempt to manufacture products that are at least equal in quality to the corresponding branded products. In the event branded producers modify their existing products or
successfully introduce new products, we may attempt to emulate the modified or new products. In conjunction with our customers, we develop packaging and graphics that rival the national brands. Our goal is that the only difference consumers perceive
when purchasing our private-brand products is a notable cost savings when compared to branded counterparts.

We also develop and manufacture branded ready-to-eat cereals under our Post® brand. Post Foods is the third-largest manufacturer of ready-to-eat cereals in the United States.

Our Frozen Bakery Products business develops, manufactures and markets frozen bakery products for the foodservice, in-store bakery,
retail and mass merchandising channels. Unlike our private-brand products, our frozen products typically are not emulations of branded products. Instead, they are designed to have unique tastes or characteristics that customers desire. To a much
lesser extent, we also offer unique, custom products in our other businesses.

In Item 2, we have listed the principal
plants operated by the Company, as well as the types of products produced at each plant.

Our Branded Cereals segment includes the Post brand ready-to-eat cereal business. Post Foods is engaged in the
production, marketing and sale of ready-to-eat cereals under its own various brand names, including Honey Bunches of
Oats®, Pebbles®, Post Selects®, Great Grains®, Spoon Size® Shredded Wheat, Post® Raisin
Bran, Grape-Nuts®, and Honeycomb®. Posts products are manufactured in the United States and Canada primarily in four manufacturing facilities, utilizing a variety of production processes,
including shredding, extruding, gun-puffing, batch cooking and continuous cooking.

U.S. sales in the grocery, mass
merchandise, drugstore and foodservice channels are managed through an internal sales staff and an independent sales agency. The business also utilizes broker distribution or similar arrangements for sales of products outside the United States. Post
products are distributed throughout the U.S. from four distribution centers.

Other Cereal Products

Our Other Cereal Products segment includes our private-brand and value-brand ready-to-eat cereals and hot cereals, and
the Bloomfield Bakers products which include nutritional bars and natural and organic specialty cookies, crackers, and cereals. Private-brand ready-to-eat cereals are currently produced at three manufacturing facilities and presently include 47
different cereal varieties utilizing flaking, extrusion and shredding technologies. Private-brand and value-brand hot cereals are produced at one facility and include old-fashioned oatmeal, quick oatmeal, regular instant oatmeal, flavored instant
oatmeal, farina, instant Ralston® (a branded hot wheat cereal) and 3 Minute Brand® hot cereals. As expected, we sell far more hot cereals in cooler months. We believe we are one of the largest
private-brand cereal manufacturers (by volume) in the U.S. when combining both private-brand ready-to-eat and hot cereals. The Bloomfield Bakers products are produced at two manufacturing facilities that also produce some ready-to-eat cereals. A
majority of the Bloomfield Bakers products are produced under co-manufacturing arrangements, with a smaller portion produced under more traditional private-brand arrangements. In fiscal 2011, approximately 56%, 7% and 37% of this segments net
sales were in ready-to-eat cereal based products, hot cereals and the Bloomfield Bakers products, respectively.

We produce
cereal products based on our estimates of customer orders and consequently maintain, on average, four to six weeks inventory of finished products. Our ready-to-eat and hot cereals are warehoused in and primarily distributed through four
independent distribution facilities and one of our cereal plants, and are shipped to customers principally via independent truck lines. As the majority of the Bloomfield Bakers products are produced under contract manufacturing arrangements, the
related production schedule is based largely on near-term forecasts provided by our customers. The Bloomfield Bakers products are then shipped via independent truck lines to specific customer distribution points. Our ready-to-eat cereals and hot
cereals are sold through internal sales staff and independent food brokers.

We believe our cracker and cookie business is one of the largest manufacturers (by volume) of private-brand crackers
and cookies for sale in North America. The business produces cookies under the Rippin Good® brand and
crackers under the Ry Krisp® and Champagne® brands. Management positions the cracker and cookie business as a low cost, premier quality producer of a wide variety of private-brand crackers and cookies. In
fiscal 2011, approximately 30% of the Snacks, Sauces & Spreads segments net sales was attributable to crackers and cookies. Our cracker and cookie business operates nine plants in the United States and Canada where products are
largely produced to order. In the fall and winter as consumption of crackers increases, we have the ability to produce to estimated volumes, thereby building product inventories ranging from four to six weeks. Private-brand crackers and cookies are
sold through a broker network and internal sales staff. Branded Ry Krisp® crackers and branded cookies,
including Rippin Good® cookies, are sold through direct store distributor networks. Our cookies and
crackers are primarily distributed from our own warehouses and delivered to customers through independent truck lines and customer supplied trucks.

Our snack nuts, candy and chips business operates three plants that produce a variety of jarred, canned and bagged
snack nuts, one plant that produces chocolate candy and one plant that produces chips (corn-based snacks). The business produces private-brand products as well as value-branded products under the Nutcracker®, Flavor House®, Hoodys®, Linette® and Medallion® brands. In fiscal 2011, approximately 36% of the Snack, Sauces & Spreads segments net sales was attributable to snack nuts, candy, and chips. Our snack
nut and candy products are largely produced to order and shipped directly to customers; however, we maintain warehouse space where finished snack nut products are stored during peak times of demand. Snack nuts and candy are shipped to customers
through independent truck lines and customer supplied trucks. We sell those products through an internal sales staff and a broker network. Profits from the sale of snack nuts are impacted significantly by the cost of raw materials (peanuts and tree
nuts). Our chocolate candy products are positioned as premium chocolate products and not as an emulation of a branded product. Consequently, our chocolate candy products are sold to customers who maintain premium private-brand product lines. We also
produce chocolate candy for customers who use the candy as ingredients for ice cream and other products. Our corn-based snack products are produced based on customer orders and are shipped directly to customers through independent truck lines and
customer supplied trucks.

Sauces & Spreads

Our sauces & spreads business operates four plants and produces a variety of private-brand shelf-stable
dressings, syrups, peanut butter, jellies, salad dressings, salsas and sauces, and non-alcoholic drink mixes under the Major Peters® and JERO® brands. The
business products are largely produced to order and are shipped directly to customers using independent truck lines. However, we maintain warehouses at our plants to hold several weeks supply of key products. The products are sold
through an internal sales staff and a broker network. In fiscal 2011, this business provided approximately 34% of the Snacks, Sauces & Spreads net sales. Approximately 85% of its net sales was to retail customers and the remaining 15% was
to foodservice, contract and other customers. Due to the varied nature of branded counterparts and customer preferences, this business produces far more variations of each type of product compared to our other businesses.

Frozen Bakery Products

Our Frozen Bakery Products business operates thirteen facilities in the United States and Canada. We produce frozen griddle products such as pancakes, waffles and French toast; frozen bread products such
as breads, rolls and biscuits; dessert products such as frozen cookies and frozen cookie dough, muffins, and Danishes; and dry mixes for bakery foods. The recently acquired refrigerated dough business expands our portfolio to include a wide variety
of private brand refrigerated dough products including biscuits, cookies, croissants and pie crusts.

The business uses a
combination of both make to order and make to inventory production scheduling processes. Items with predictable volumes tend to be produced to inventory, while items with inconsistent demand are typically produced to order. The majority of the
products are shipped frozen with most high volume customers serviced direct from the manufacturing site, while smaller volume items are distributed through a network of third party warehouses.

The Frozen Bakery Products business sells products through a broker network and an internal sales staff. Products are
sold to foodservice customers such as large restaurant chains and distributors of foodservice products, retail grocery chains, and mass merchandisers. We utilize the trademark Krusteaz® for frozen griddle products sold to retail grocery chains and mass merchandisers. Also, we produce in-store bakery cookies under the Lofthouse® and Parco® brands and in-store bakery bread under the Panne Provincio® brand. Sales of cookies increase significantly in anticipation of holidays.

We sell a significant amount of products to a large international chain of restaurants. The loss of that customer would have a material adverse effect on the Frozen Bakery Products business.

In fiscal 2011, approximately 39% of the businesss gross sales was griddle products, 25% was breads, rolls, muffins, and
biscuits, 27% was dessert products and 9% represented frozen dough, oatmeal, and other dry mixes. Approximately 36% of its net sales was in the foodservice channel, 38% was to in-store bakeries and 26% was retail.

Our American Italian Pasta Company (AIPC) division is one of the largest producers (by volume) of dry pasta in North
America. The pasta business product line is comprised of approximately 3,100 stock-keeping units, or SKUs, of pasta. We produce approximately 300 different shapes and sizes of pasta products in multiple package configurations, including bulk
packages for institutional customers and individually-wrapped packages for retail consumers. The varied shapes and sizes include long goods such as spaghetti, linguine, fettuccine, angel hair and lasagna, and short goods such as elbow macaroni,
mostaccioli, rigatoni, rotini, ziti, and egg noodles. These products are manufactured at our four plants for a variety of customers including those who purchase our products as branded offerings under names such as Pennsylvania Dutch®, Heartland®, Golden Grain®,
Anthonys®, Pasta Lensi®, Ronco® or Muellers® from retailers, as well as for retailers who sell products we manufacture as private brands. In many instances, we
produce pasta to our customers' unique specifications.

The pasta industry consists of two primary customer markets: the
retail market which includes grocery, mass merchandise, and drugstore channels that sell branded and private-brand pasta to consumers; and the institutional market, which includes both foodservice customers that supply restaurants, hotels, schools
and hospitals, and other food processors that use pasta as a food ingredient.

We actively sell and market our domestic
products through our sales employees and with the use of food brokers and distributors throughout the United States and Canada. Our primary distribution centers in North America are strategically located at our production facilities in Missouri,
South Carolina and Arizona to serve the national market. Our Italian plant enables us to offer authentic Italian pasta products. This facility serves European, North American, and other international markets with proprietary branded, customer
branded, ingredient and food service products. In fiscal 2011, all of this segments net sales was in pasta. Approximately 80% was in the retail channel and 20% was institutional.

Our
businesses face intense competition from large branded manufacturers and highly competitive private-brand and foodservice manufacturers in each of their product lines. Further, in some instances, large branded companies presently manufacture, or in
the past have manufactured, private-brand products. Top cereal competitors include Kellogg, General Mills, Quaker Oats (owned by PepsiCo), and Malt-O-Meal. Large branded competitors of the Snacks, Sauces & Spreads business include Nabisco
(owned by Kraft) and Keebler (owned by Kellogg), which possess large portions of the branded cracker and cookie categories. The Snacks, Sauces & Spreads business also faces competition from Kraft Foods, Bestfoods (owned by Unilever),
Smuckers and Heinz as well as significant competition in the snack nut category from Planters (owned by Kraft), Emerald (owned by Diamond Foods) and Blue Diamond. Branded competitors in the snack mix and corn-based snack categories include
General Mills and Frito Lay (owned by PepsiCo). The Frozen Bakery Products business faces intense competition from numerous producers of griddle, bread and cookie products, including Kellogg. The Pasta segment faces competition from Barilla, New
World Pasta Company (owned by Ebro Puleva - a Spanish company), Dakota Growers Pasta Company (owned by Viterra, Inc.), Philadelphia Macaroni Co. Inc., A. Zerega's Sons, Inc., and other foreign companies. For sales in Europe and other international
markets, our Italian plant competes with Barilla and numerous European pasta producers.

The industries in which we compete
are highly sensitive to pricing and both the frequency and depth of promotion. Competition is based upon product quality, price, effective promotional activities, and the ability to identify and satisfy emerging consumer preferences. These
industries are expected to remain highly competitive in the foreseeable future. Our customers do not typically commit to buy predetermined amounts of products. Moreover, many food retailers utilize bidding procedures to select vendors. Consequently,
during the course of a year, up to 50% of any segments business can be subject to a bidding process conducted by our customers.

In fiscal 2011, Wal-Mart Stores, Inc. accounted for approximately 18% of our aggregate net sales. Each of our reporting segments sells products to Wal-Mart. No other customer accounted for 10% or more of
our consolidated net sales. Additionally, we sell our products to retail chains, mass merchandisers, grocery wholesalers, warehouse club stores, drugstores, restaurant chains and foodservice distributors across the country as well as in Canada,
Europe and Southeast Asia. We closely monitor the credit risk associated with our customers and to date have not experienced material losses.

Seasonality

Certain
aspects of our operations, especially in the Snacks, Sauces & Spreads segment, hot cereal portion of the Other Cereal Products segment, in-store bakery portion of the Frozen Bakery Products segment and the higher margin noodles and lasagna
portion of the Pasta segment, are somewhat seasonal, with a slightly higher percentage of sales and operating profits expected to be recorded in the first and fourth fiscal quarters. See Note 21 in Item 8 for historical quarterly data.

Employees

As of September 30, 2011, we had approximately 11,000 employees, of whom approximately 9,290 were located in the United States,
approximately 1,650 were located in Canada and approximately 60 were located in Europe. We have entered into numerous collective bargaining agreements that we believe contain terms that are typical for the industries in which we operate. In fiscal
2012, collective bargaining agreements at the following plants will expire: Fridley, Minnesota; Niagara Falls, Ontario; Streator, Illinois; Poteau, Oklahoma; Lancaster, Ohio; Carrollton, Texas; Brantford, Ontario and Ripon, Wisconsin. As these
agreements expire, we believe that the agreements can be renegotiated on terms satisfactory to us. We believe our relations with our employees, including union employees, are good.

Raw Materials, Freight, and Energy

Our raw materials consist of
ingredients and packaging materials. Our principal ingredients are wheat (including durum wheat), nuts (including peanuts and cashews), sugar, edible oils, corn, oats, cocoa, eggs and rice. Our principal packaging materials are linerboard cartons,
corrugated boxes, plastic bottles, plastic containers and composite cans. We purchase raw materials from local, regional, national and international suppliers. The cost of raw materials used in our products may fluctuate widely due to weather
conditions, labor disputes, government regulations, industry consolidation, economic climate, energy shortages, transportation delays, or other unforeseen circumstances. The supply of raw materials can be negatively impacted by the same factors that
can impact their cost. From time to time, we will enter into supply contracts for periods of up to three years to secure favorable pricing for ingredients and up to five years for packaging materials. For most of our sales, we pay freight costs to
deliver our products to the customer via common carriers or our own trucks. Freight costs are affected by both fuel prices and the availability of common carriers in the area. We also purchase natural gas, electricity, and steam for use in our
processing facilities. Where possible and when advantageous, we enter into purchase or other hedging contracts of up to 18 months to reduce the price volatility of these items and the cost impact upon our operations. In fiscal 2011, ingredients,
packaging, freight, and energy represented approximately 48%, 18%, 7%, and 2%, respectively, of our total cost of goods sold.

Governmental
Regulation and Environmental Matters

We are subject to regulation by federal, state, local and foreign governmental
entities and agencies. As a producer of goods for human consumption, our operations must comply with stringent production, food safety and labeling standards administered by the Food and Drug Administration in the United States as well as similar
regulatory agencies in Canada and Europe. From time to time, changes in regulations can lead to costly label format modifications and product formulation changes. In the event such changes cause use of different ingredients, the cost of goods sold
may also increase. In many instances, we may not be able to offset the increased cost through pricing actions.

Our
facilities, like those of similar businesses, are subject to certain safety regulations including regulations issued pursuant to the U.S. Occupational Safety and Health Act in the United States and similar regulatory agencies in Canada and Italy.
These regulations require us to comply with certain manufacturing safety standards to protect our employees from accidents. We believe that we are in compliance in all material respects with all employee safety regulations.

Our operations are also subject to various federal, state and local laws and regulations
with respect to environmental matters, including air quality, waste water pretreatment, storm water, waste handling and disposal, and other regulations intended to protect public health and the environment. The Environmental Protection Agency and
related environmental governmental agencies notified us that we may be liable for improper air emissions at three of our California plants. We anticipate we will be indemnified for a significant portion of any remediation and penalties by the
previous owners of the facilities. We believe that we have adequate reserves to cover any remaining unindemnified liability that may result from these investigations.

We are in the process of upgrading and adding to our pollution control capabilities - both wastewater treatment and air pollution control. We anticipate investing up to $14 million at a number of our
manufacturing facilities on these efforts over the next several years. While it is difficult to quantify with certainty the potential financial impact of actions regarding expenditures for environmental matters and future capital expenditures for
environmental control equipment, in the opinion of management, based upon the information currently available, the ultimate liability arising from such environmental matters, taking into account established accruals for estimated liabilities and any
indemnified costs, is not reasonably likely to have a material effect on our consolidated results of operations, financial position, capital expenditures or other cash flows.

All imported pasta is subject to U.S. import regulations. Duties are assessed in accordance with the Harmonized Tariff Schedule of the United States and are subject to regular review.

Contract Manufacturing

From time to time, our segments may produce products on behalf of other companies. Typically, such products are new branded products for
which branded companies lack capacity or products of branded companies that do not have their own manufacturing facilities. In both cases, the branded companies retain ownership of the formulas and trademarks related to products we produce for them.
Contract manufacturing for branded companies tends to be inconsistent in volume. Often, initial orders can be significant and favorably impact a fiscal period (with respect to sales and profits) but later volume will level off or the branded company
will ultimately produce the product internally and cease purchasing product from us. Net sales under these co-manufacturing agreements were approximately 5% to 8% of our annual net sales for the past three years and were approximately
$345 million in fiscal 2011. We expect our arrangement with one of these customers, which accounted for approximately 4% of our total net sales in fiscal 2011, may end during fiscal 2012.

Co-Chief Executive Officer and President of the Company since September 2003. He will become Chief Executive Officer effective January 1, 2012.

David P. Skarie

65

Co-Chief Executive Officer and President of the Company since September 2003. He is retiring from the Company effective December 31, 2011.

Gregory A. Billhartz

39

Corporate Vice President, General Counsel and Secretary since October 2009. Prior to joining the Company he was Assistant General Counsel and Assistant Secretary at Arch Coal, Inc.
from November 2005 to October 2009.

Walter N. George

55

Corporate Vice President and President, American Italian Pasta Company. Prior to joining the Company in July 2010, he was Chief Operating Officer at American Italian Pasta Company
from December 2008 to July 2010 and Executive Vice President-Operations and Supply Chain from February 2003 to December 2008.

Thomas G. Granneman

62

Corporate Vice President and Chief Accounting Officer since February 2010. Mr. Granneman served as Corporate Vice President and Controller of the Company from January 1999 to
February 2010. He is retiring effective December 31, 2011.

Charles G. Huber, Jr.

47

Corporate Vice President, and President Ralcorp Frozen Bakery Products, Inc. since October 2009. He served as Corporate Vice President, General Counsel and Secretary of the Company
from October 2003 to October 2009.

Richard R. Koulouris

55

Corporate Vice President, and President, Ralcorp Snacks, Sauces & Spreads since October 2009. He has also served as President of Bremner Food Group, Inc. and Nutcracker Brands,
Inc. since November 2003 (except from December 2006 to March 2008) and President of The Carriage House Companies, Inc. since December 2006.

Scott Monette

50

Corporate Vice President, Treasurer and Corporate Development Officer since February 2010. He served as Corporate Vice President and Treasurer from September 2001 to February 2010
and will become Chief Financial Officer effective January 1, 2012.

Ronald D. Wilkinson

61

Corporate Vice President, and President, Ralcorp Cereal Products since July 2010. He served as Corporate Vice President and President of Ralston Foods from March 2008 to July 2010.
He also served as President of Bremner Food Group, Inc. and Nutcracker Brands, Inc. from December 2006 to March 2008 and served as Director of Product Supply of Ralston Foods from October 1996 to November 2006 and of The Carriage House Companies,
Inc. from January 2003 to November 2006.

In addition
to the factors discussed elsewhere in this report, the following risks and uncertainties could have a material adverse effect on our business, financial condition and results of operations. Additional risks and uncertainties not presently known to
us or that we currently deem immaterial may also impair our business operation, financial condition or results.

Risks Related to Our
Business

We may not be able to effectively manage the growth from acquisitions or continue to make acquisitions at the rate at which
we have been acquiring in the past.

We have experienced significant growth in sales and operating profits through the
acquisition of other companies. However, acquisition opportunities may not always present themselves. In such cases, our sales and operating profit may not continue to grow from period to period at the same rate as it has in the past.

The success of our acquisitions will depend on many factors, such as our ability to identify potential acquisition candidates, negotiate
satisfactory purchase terms, obtain loans at satisfactory rates to fund acquisitions, and successfully integrate and manage the growth from acquisitions. Integrating the operations, financial reporting, disparate technologies and personnel of newly
acquired companies involve risks. We cannot guarantee that we will be successful or cost-effective in integrating any new businesses into our existing businesses. In fact, the process of integrating newly acquired businesses may cause interruption
or slow down the operations of our existing businesses. As a result, we may not be able to realize expected synergies or other anticipated benefits of acquisitions.

The primary commodities used by our businesses include wheat (including durum wheat), nuts (including peanuts and cashews), sugar, edible oils, corn, oats, cocoa, eggs, and rice, and our primary packaging
includes linerboard cartons, corrugated boxes, plastic containers and composite cans. In addition, many of our manufacturing operations use large quantities of natural gas and electricity. The costs of such commodities may fluctuate widely and we
may experience shortages in commodity items as a result of commodity market fluctuations, availability, increased demand, weather conditions, and natural disasters as well as other factors outside of our control. Higher prices for natural gas,
electricity and fuel may also increase our production and delivery costs. Changes in the prices charged for our products may lag behind changes in our energy and commodity costs. Accordingly, changes in commodity or energy costs may limit our
ability to maintain existing margins and have a material adverse effect on our operating profits.

We generally use commodity
futures and options to reduce the price volatility associated with anticipated raw material purchases. Additionally, we have a hedging program for diesel fuel prices (using market traded heating oil as an effective proxy), natural gas, and
corrugated paper products. The extent of our hedges at any given time depends upon our assessment of the markets for these commodities, including our assumptions for future prices. For example, if we believe that market prices for the commodities we
use are unusually high, we may choose to hedge less, or possibly not hedge any, of our future requirements. If we fail to hedge and prices subsequently increase, or if we institute a hedge and prices subsequently decrease, our costs may be greater
than anticipated or greater than our competitors costs and our financial results could be adversely affected.

We compete in
mature categories with strong competition.

We compete in mature segments with competitors that have a large
percentage of segment sales. Our private-brand and branded products both face strong competition from branded competitors for shelf space and sales. Competitive pressures could cause us to lose market share, which may require us to lower prices,
increase marketing expenditures or increase the use of discounting or promotional programs, each of which would adversely affect our margins and could result in a decrease in our operating results and profitability.

Some of our competitors have substantial financial, marketing and other resources, and competition with them in our various markets and
product lines could cause us to reduce prices, increase marketing, or lose category share, any of which would have a material adverse effect on our business and financial results. This high level of competition by branded competitors could result in
a decrease in our sales volumes. In addition, increased trade spending or advertising or reduced prices on our competitors products may require us to do the same for our products which could impact our margins and volumes. If we did not do the
same, our revenue, profitability and market share could be adversely affected.

Our inability to successfully manage the price gap between our private-brand products and those of our
branded competitors may adversely affect our results of operation.

Competitors branded products have an
advantage over our private-brand products primarily due to advertising and name recognition. When branded competitors focus on price and promotion, the environment for private-brand products becomes more challenging because the price gaps between
private-brand and branded products can become less meaningful.

At the retail level, private-brand products sell at a discount
to those of branded competitors. If branded competitors continue to reduce the price of their products, the price of branded products offered to consumers may approximate or be lower than the prices of our private-brand products. Further,
promotional activities by branded competitors such as temporary price rollbacks, buy-one-get-one-free offerings and coupons have the effect of price decreases. Price decreases taken by competitors could result in a decline in our sales volumes.

Significant private-brand competitive activity can lead to price declines.

Some customer buying decisions are based on a periodic bidding process in which the successful bidder is assured the selling of its
selected product to the food retailer, super center or mass merchandiser until the next bidding process. Our sales volume may decrease significantly if our offer is too high and we lose the ability to sell products through these channels, even
temporarily. Alternatively, we risk reducing our margins if our offer is successful but below our desired price points. Either of these outcomes may adversely affect our results of operations.

Unsuccessful implementation of business strategies to reduce costs may adversely affect our results of operations.

Many of our costs, such as raw materials, energy and freight are outside our control. Therefore, we must seek to reduce costs in other
areas, such as operating efficiency. If we are not able to complete projects which are designed to reduce costs and increase operating efficiency on time or within budget, our operating profits may be adversely impacted. In addition, if the cost
saving initiatives we have implemented or any future cost savings initiatives do not generate the expected cost savings and synergies, our results of operations may be adversely affected.

Our ability to raise prices for our products may be adversely affected by a number of factors, including but not limited to industry supply, market demand, and promotional activity by competitors. If we
are unable to increase prices for our products as may be necessary to cover cost increases, our results of operations could be adversely affected. In addition, price increases typically generate lower volumes as customers then purchase fewer units.
If these losses are greater than expected or if we lose distribution as a result of a price increase, our results of operations could be adversely affected.

Loss or bankruptcy or insolvency of a significant customer may adversely affect our results of operations.

A limited number of customer accounts represent a large percentage of our consolidated net sales. The success of our business depends, in part, on our ability to maintain our level of sales and product
distribution through high volume food retailers, super centers and mass merchandisers. The competition to supply products to these high volume stores is intense. Currently, we do not have long-term supply agreements with a substantial number of our
customers. These high volume stores and mass merchandisers frequently re-evaluate the products they carry. If a major customer elected to stop carrying one of our products, our sales may be adversely affected.

If our food products become adulterated, misbranded, or mislabeled, we might need to recall those items and may experience product liability claims
if consumers are injured.

Selling food products involves a number of legal and other risks, including product
contamination, spoilage, product tampering, allergens, or other adulteration. We may need to recall some or all of our products if they become adulterated, mislabeled or misbranded. This could result in destruction of product inventory, negative
publicity, temporary plant closings, and substantial costs of compliance or remediation. Should consumption of any product cause injury, we may be liable for monetary damages as a result of a judgment against us. In addition, adverse publicity
including claims, whether or not valid, that our products or ingredients are unsafe or of poor quality, may discourage consumers from buying our products or cause production and delivery disruptions. Any of these events, including a significant
product liability judgment against us, could result in a loss of consumer confidence in our food products. This could have an adverse affect on our financial condition, results of operations or cash flows.

Disruption of our supply chain could have an adverse effect on our business, financial condition and
results of operations.

Our ability, including manufacturing or distribution capabilities, and that of our suppliers,
business partners and contract manufacturers, to make, move and sell products is critical to our success. Damage or disruption to our or their manufacturing or distribution capabilities due to weather, including any potential effects of climate
change, natural disaster, fire or explosion, terrorism, pandemics, strikes, repairs or enhancements at our facilities, or other reasons, could impair our ability to manufacture or sell our products. Failure to take adequate steps to mitigate the
likelihood or potential impact of such events, or to effectively manage such events if they occur, could adversely affect our business, financial condition and results of operations, as well as require additional resources to restore our supply
chain.

We may be unable to anticipate changes in consumer preferences and trends, which could result in decreased demand for our
products.

Our success depends in part on our ability to anticipate the tastes and eating habits of consumers and to
offer products that appeal to their preferences. Consumer preferences change from time to time and can be affected by a number of different and unexpected trends. Our failure to anticipate, identify or react quickly to these changes and trends, and
to introduce new and improved products on a timely basis, could result in reduced demand for our products, which would in turn cause our revenues and profitability to suffer. Similarly, demand for our products could be affected by consumer concerns
regarding the health effects of nutrients or ingredients such as trans fats, sugar, processed wheat or other product attributes.

We
have a substantial amount of indebtedness which could limit financing and other options.

As of September 30,
2011, we had long-term debt (including current maturities) of approximately $2,203.2 million. The agreements under which we have issued indebtedness do not prevent us from incurring additional unsecured indebtedness in the future but our ability to
comply with the financial covenants and restrictions may be affected by events beyond our control, including prevailing economic, financial and industry conditions. Our level of indebtedness may limit:



our ability to obtain additional financing for working capital, capital expenditures, to fund growth or general corporate purposes, particularly if the
ratings assigned to our debt securities by rating organizations were revised downward; and



our flexibility to adjust to changing business and market conditions and may make us more vulnerable to a downward turn in general economic conditions.

Our ability to meet expenses and debt service obligations will depend on the factors described above, as
well as our future performance, which will be affected by financial, business, economic and other factors, including potential changes in consumer preferences, the success of product and marketing innovation and pressure from competitors. If we do
not generate enough cash to pay our debt service obligations, we may be required to refinance all or part of our existing debt, sell our assets, borrow more money or raise equity. An event of default under our debt agreements would permit some of
our lenders to declare all amounts borrowed from them to be due and payable, together with accrued and unpaid interest and may also impair our ability to obtain additional or alternative financing. There is no assurance that we will be able to, at
any given time, refinance our debt, sell our assets, borrow more money or raise equity on terms acceptable to us or at all.

U.S. and global credit markets have from time to time experienced significant dislocations and liquidity disruptions which caused the spreads on prospective debt financings to widen considerably. These
circumstances materially impacted liquidity in the debt markets, making financing terms for borrowers less attractive, and in certain cases resulted in the unavailability of certain types of debt financing. Events affecting the credit markets have
also had an adverse effect on other financial markets in the U.S., which may make it more difficult or costly for us to raise capital through the issuance of common stock or other equity securities or refinance our existing debt, sell our assets or
borrow more money if necessary. Our business could also be negatively impacted if our suppliers or customers experience disruptions resulting from tighter capital and credit markets or a slowdown in the general economy. Any of these risks could
impair our ability to fund our operations or limit our ability to expand our business or increase our interest expense, which could have a material adverse effect on our financial results.

We have operations and assets in Canada and Europe. Our consolidated financial statements are presented in U.S.
dollars; therefore, we must translate our foreign assets, liabilities, revenue and expenses into U.S. dollars at applicable exchange rates. Consequently, fluctuations in the value of the Canadian dollar or the Euro may negatively affect the value of
these items in our consolidated financial statements. To the extent we fail to manage our foreign currency exposure adequately, we may suffer losses in value of our net foreign currency investment and our consolidated results of operations and
financial position may be negatively affected.

The termination or expiration of current co-manufacturing arrangements could reduce our
sales volume and adversely affect our results of operations.

Our businesses periodically enter into co-manufacturing
arrangements with manufacturers of branded products. Terms of these agreements vary but are generally for relatively short periods of time (less than two years). Volumes produced under each of these agreements can fluctuate significantly based upon
the products life cycle, product promotions, alternative production capacity and other factors, none of which are under our direct control. Our future ability to enter into co-manufacturing arrangements is not guaranteed, and a decrease in
current co-manufacturing levels could have a significant negative impact on sales volume.

Consolidation among the retail grocery and
foodservice industries may hurt profit margins.

Over the past several years, the retail grocery and foodservice
industries have undergone significant consolidations and mass merchandisers are gaining market share. As this trend continues and such customers grow larger, they may seek to use their position to improve their profitability through improved
efficiency, lower pricing or increased promotional programs. If we are unable to use our scale, marketing expertise, product innovation and category leadership positions to respond to these demands, our profitability or volume growth could be
negatively impacted. Additionally, if the surviving entity is not a customer, we may lose significant business once held with the acquired retailer.

Violations of laws or regulations, as well as new laws or regulations or changes into existing laws or regulations, could adversely affect our business.

The food production and marketing industry is subject to a variety of federal, state, local and foreign laws and regulations, including
those related to food safety, food labeling, food safety requirements related to the ingredients, manufacture, processing, storage, marketing, advertising, labeling, and distribution of our products as well as those related to worker health and
workplace safety and environmental matters. Our activities, both in and outside of the United States, are subject to extensive regulation. In the U.S. we are regulated by, among other federal and state authorities, the U.S. Food and Drug
Administration, U.S. Federal Trade Commission, the U.S. Departments of Agriculture, Commerce and Labor as well as by similar authorities abroad. Governmental regulations also affect taxes and levies, healthcare costs, energy usage, immigration and
other labor issues, all of which may have a direct or indirect effect on our business or those of our customers or suppliers. In addition, we market and advertise our products and could be the target of claims relating to alleged false or deceptive
advertising under federal, state, and foreign laws and regulations and may be subject to initiatives to limit or prohibit the marketing and advertising of our products to children. Changes in these laws or regulations or the introduction of new laws
or regulations could increase the costs of doing business for us or our customers or suppliers or restrict our actions, causing our results of operations to be adversely affected. Further, if we are found to be out of compliance with applicable laws
and regulations in these areas, we could be subject to civil remedies, including fines, injunctions, or recalls, as well as potential criminal sanctions, any of which could have a material adverse effect on our business.

As a publicly traded company, we are further subject to changing rules and regulations of federal and state governments as well as the
stock exchange on which our common stock is listed. These entities, including the Public Company Accounting Oversight Board, the SEC and the New York Stock Exchange, have issued a significant number of new and increasingly complex requirements and
regulations over the course of the last several years and continue to develop additional regulations and requirements in response to laws enacted by Congress. Our efforts to comply with these requirements have resulted in, and are likely to continue
to result in, an increase in expenses and a diversion of managements time from other business activities.

We may not be able to operate successfully if we lose key personnel, are unable to hire qualified
additional personnel, or experience turnover of our management team.

We are highly dependent on our ability to
attract and retain qualified personnel to operate and expand our business. If we lose one or more members of our senior management team, our business and financial position, results of operations or cash flows could be harmed. Our compensation
programs are intended to attract and retain the employees required for it to be successful, but ultimately, we may not be able to attract new employees or retain the services of all of our key employees or a sufficient number to execute on our
plans.

If existing anti-dumping measures imposed against certain foreign imports of dry pasta terminate, we will face increased
competition from foreign companies and the profit margins or market share of our pasta segment could be adversely affected.

Anti-dumping and countervailing duties on certain Italian and Turkish imports imposed by the United States Department of Commerce in 1996 enable us and our domestic competitors to compete more favorably
against Italian and Turkish producers in the U.S. pasta market. In September 2007, the U.S. International Trade Commission extended the anti-dumping and countervailing duty orders for an additional five years, through 2012. If the anti-dumping and
countervailing duty orders are repealed or foreign producers sell competing products in the United States at prices lower than ours or enter the U.S. market by establishing production facilities in the United States, the result would further
increase competition in the U.S. pasta market and could have a material adverse effect on our business, financial condition or results of operations.

Labor strikes or work stoppages by our employees could harm our business.

Currently, a significant number of our full-time distribution, production and maintenance employees are covered by collective bargaining agreements. A dispute with a union or employees represented by a
union could result in production interruptions caused by work stoppages. If a strike or work stoppage were to occur, our results of operations could be adversely affected.

We may experience losses or be subject to increased funding and expenses to our qualified pension plan, which could negatively impact profits.

We maintain a qualified defined benefit plan and we remain obligated to ensure that the plan is funded in accordance with applicable
regulations. The fair value of pension plan assets (determined pursuant to ASC Topic 715 guidelines) was approximately $36.2 million below the total benefit obligation of the plan as of September 30, 2011 despite a $20 million contribution to
the plan in fiscal 2011. In the event the stock market deteriorates, the funds in which we have invested do not perform according to expectations, or the valuation of the projected benefit obligation increases due to changes in interest rates or
other factors, we may be required to make significant cash contributions to the pension plan and incur increased expense.

Impairment in
the carrying value of goodwill or other intangibles could negatively impact our net worth.

The net carrying value of
goodwill represents the fair value of acquired businesses in excess of identifiable assets and liabilities as of the acquisition date (or subsequent impairment date, if applicable). The net carrying value of other intangibles represents the fair
value of trademarks, customer relationships, and other acquired intangibles as of the acquisition date (or subsequent impairment date, if applicable), net of accumulated amortization. Goodwill and other acquired intangibles expected to contribute
indefinitely to our cash flows are not amortized, but must be evaluated by management at least annually for impairment. Amortized intangible assets are evaluated for impairment whenever events or changes in circumstance indicate that the carrying
amounts of these assets may not be recoverable. Impairments to goodwill and other intangible assets may be caused by factors outside our control, such as the inability to quickly replace lost co-manufacturing business, increasing competitive pricing
pressures, lower than expected revenue and profit growth rates, changes in industry EBITDA multiples, changes in discount rates based on changes in cost of capital (interest rates, etc.), or the bankruptcy of a significant customer and could
negatively impact our net worth. For additional information on impairment of intangible assets, including recent impairment losses, refer to Impairment of Intangible Assets and Critical Accounting Policies and Estimates in
Item 7 and Note 4 in Item 8.

We increasingly rely on information technology systems to process, transmit, and store electronic information. For
example, our production and distribution facilities and inventory management utilize information technology to increase efficiencies and limit costs. Furthermore, a significant portion of the communications between our personnel, customers, and
suppliers depends on information technology. Like other companies, our information technology systems may be vulnerable to a variety of interruptions due to events beyond our control, including, but

not limited to, natural disasters, terrorist attacks, telecommunications failures, computer viruses, hackers, and other security issues. We have technology security initiatives and disaster
recovery plans in place or in process to mitigate our risk to these vulnerabilities, but these measures may not be adequate.

Our
intellectual property rights are valuable, and any inability to protect them could reduce the value of our products and brands.

We consider our intellectual property rights, particularly our trademarks, but also our patents, trade secrets, copyrights and licenses, to be a significant and valuable aspect of our business. We attempt
to protect our intellectual property rights through a combination of patent, trademark, copyright and trade secret laws, as well as licensing agreements, third party nondisclosure and assignment agreements and the policing of third party misuses of
our intellectual property. Our failure to obtain or maintain adequate protection of our intellectual property rights, or any change in law or other changes that serve to lessen or remove the current legal protections for intellectual property, may
diminish our competitiveness and could materially harm our business.

We also face the risk of claims that we have infringed
third parties intellectual property rights. Any claims of intellectual property infringement, even those without merit, could be expensive and time consuming to defend; cause us to cease making, licensing or using products that incorporate the
challenged intellectual property; require us to redesign or rebrand our products or packaging, if feasible; divert managements attention and resources; or require us to enter into royalty or licensing agreements in order to obtain the right to
use a third partys intellectual property. Any royalty or licensing agreements, if required, may not be available to us on acceptable terms or at all. Additionally, a successful claim of infringement against us could result in our being
required to pay significant damages, enter into costly license or royalty agreements, or stop the sale of certain products, any of which could have a negative impact on our operating profits and harm our future prospects.

We are subject to environmental laws and regulations that can impose significant costs and expose us to potential financial liabilities.

We are subject to extensive and frequently changing federal, state, local and foreign laws and regulations relating
to the protection of human health and the environment, including those limiting the discharge and release of pollutants into the environment and those regulating the transport, storage, use, treatment, disposal and remediation of, and exposure to,
solid and hazardous wastes and materials. Certain environmental laws and regulations can impose joint and several liability without regard to fault on responsible parties, including past and present owners and operators of sites, related to cleaning
up sites at which hazardous wastes or materials were disposed or released. Failure to comply with environmental laws and regulations could result in severe fines and penalties by governments or courts of law. In addition, various current and likely
future federal, state, local and foreign laws and regulations could regulate the emission of greenhouse gases, particularly carbon dioxide and methane. We cannot predict the impact that such regulation may have, or that climate change may otherwise
have, on our business.

While we believe that the future cost of compliance with environmental laws and regulations and
liabilities associated with our operations will not have a material adverse effect on our business, we cannot assure you that future events, such as new or more stringent environmental laws and regulations, any related damage claims, the discovery
of currently unknown environmental conditions requiring response action, or more vigorous enforcement or a new interpretation of existing environmental laws and regulations, would not require us to incur additional costs that could have a material
adverse effect on our financial results.

Changes in weather conditions, natural disasters and other events beyond our control can
adversely affect our results of operations.

Changes in weather conditions and natural disasters such as floods,
droughts, frosts, earthquakes, hurricane, fires or pestilence, may affect the cost and supply of commodities and raw materials, including tree nuts, corn syrup, sugar and wheat. Additionally, these events can result in reduced supplies of raw
materials and longer recoveries of usable raw materials. Competing manufacturers can be affected differently by weather conditions and natural disasters depending on the location of their suppliers and operations. Damage or disruption to our
manufacturing or distribution capabilities due to weather, natural disaster, fire, terrorism, pandemic, strikes or other reasons could impair our ability to manufacture or sell our products. Failure to take adequate steps to reduce the likelihood or
mitigate the potential impact of such events, or to effectively manage such events if they occur, particularly when a product is sourced from a single location, could adversely affect our business and results of operations, as well as require
additional resources to restore our supply chain.

Risks Related to the Separation of the Post Cereals Business and Related Financing Transactions

The combined post-separation value of Ralcorp and Post Holdings shares may not equal or exceed the pre-separation value of Ralcorp
shares.

After the separation of the Post cereals business, our common stock will continue to be listed and traded on
the New York Stock Exchange under the symbol RAH. Post Holdings intends to apply to have its common stock authorized for listing on the New York Stock Exchange under the symbol POST. The combined trading prices of Ralcorp
common stock and Post common stock after the separation, as adjusted for any changes in the combined capitalization of these companies, may not be equal to or greater than the trading price of Ralcorp common stock prior to the separation. Until the
market has fully evaluated the business of Ralcorp without the Post cereals business, the price at which Ralcorp common stock trade may fluctuate significantly.

Potential liabilities may arise due to fraudulent transfer considerations, which would adversely affect our financial condition and our results of operations.

In connection with the separation, we intend to undertake financing transactions which, along with the separation and the financing
transactions involving the separation, may be subject to federal and state fraudulent conveyance and transfer laws. If a court were to determine under these laws that, at the time of the separation, any entity involved in these transactions or the
separation:



was insolvent,



was rendered insolvent by reason of the separation,



had remaining assets constituting unreasonably small capital, or



intended to incur, or believed it would incur, debts beyond its ability to pay these debts as they matured,

the court could void the separation, in whole or in part, as a fraudulent conveyance or transfer. The court could then require the new Post Holdings
shareholders to return to Ralcorp some or all of the shares of the Post Holdings common stock issued pursuant to the separation, or require us or Post, as the case may be, to fund liabilities of the other company for the benefit of creditors. The
measure of insolvency will vary depending upon the jurisdiction whose law is being applied. Generally, however, an entity would be considered insolvent if the fair value of its assets were less than the amount of its liabilities or if it incurred
debt beyond its ability to repay the debt as it matures.

The separation could result in significant tax liability.

We expect to receive a private letter ruling from the IRS to the effect that, among other things, the separation and certain related
transactions will qualify for tax-free treatment under the Internal Revenue Code of 1986, as amended, or the Code. In addition, we expect to obtain an opinion from our legal counsel substantially to the effect that, among other things,
the separation and certain related transactions will qualify for tax-free treatment under the Code, and that accordingly, for U.S. federal income tax purposes, no gain or loss will be recognized by, and no amount will be included in the income
of, a holder of Ralcorp common stock upon the receipt of shares of our common stock pursuant to the separation, except to the extent such holder receives cash in lieu of fractional shares of our common stock.

Although a private letter ruling from the IRS generally is binding on the IRS, if the factual representations or assumptions made in the
letter ruling request are untrue or incomplete in any material respect, we will not be able to rely on the ruling. Furthermore, the IRS will not rule on whether a distribution satisfies certain requirements necessary to obtain tax-free treatment
under the Code. Rather, the ruling will be based upon representations by us that these conditions have been satisfied, and any inaccuracy in such representations could invalidate the ruling. The opinion referred to above will address all of the
requirements necessary for the separation and certain related transactions to obtain tax-free treatment under the Code and will be based on, among other things, certain assumptions and representations made by Post and us, which if incorrect or
inaccurate in any material respect would jeopardize the conclusions reached by counsel in such opinion. The opinion will not be binding on the IRS or the courts.

If the separation does not qualify for tax-free treatment for U.S. federal income tax purposes, then, in general, we would be subject to tax as if we had sold the Post common stock and our senior
notes in a taxable sale for its fair market value. Our shareholders would be subject to tax as if they had received a distribution equal to the fair market value of our common stock that was distributed to them, which generally would be treated
first as a taxable dividend to the extent of our earnings and profits, then as a non-taxable return of capital to the extent of each shareholders

tax basis in our stock, and thereafter as capital gain with respect to the remaining value. It is expected that the amount of any such taxes to us and our shareholders would be substantial. In
addition, even if the separation otherwise qualifies for tax-free treatment for U.S. federal income tax purposes, we could be subject to corporate income tax if the retained shares, senior notes or cash received from Post are not disposed of in a
qualifying manner.

The tax rules applicable to the separation may restrict us from engaging in certain corporate transactions or from
raising equity capital beyond certain thresholds for a period of time after the separation.

Current U.S. federal
income tax law creates a presumption that the distribution of Post would be taxable to us, but not our shareholders, if such distribution is part of a plan or series of related transactions pursuant to which one or more persons acquire
directly or indirectly stock representing a 50% or greater interest (by vote or value) in Ralcorp or Post. Acquisitions that occur during the four-year period that begins two years before the date of the distribution are presumed to occur pursuant
to a plan or series of related transactions, unless it is established that the acquisition is not pursuant to a plan or series of transactions that includes the distribution. U.S. Treasury regulations currently in effect generally provide that
whether an acquisition and a distribution are part of a plan is determined based on all of the facts and circumstances, including, but not limited to, specific factors described in the U.S. Treasury regulations. In addition, the
U.S. Treasury regulations provide several safe harbors for acquisitions that are not considered to be part of a plan.

These rules will limit our ability during the two-year period following the distribution to enter into certain transactions that may be advantageous to us and our shareholders, particularly issuing equity
securities to satisfy financing needs, repurchasing equity securities, disposing of certain assets, engaging in mergers and acquisitions, and, under certain circumstances, acquiring businesses or assets with equity securities or agreeing to be
acquired.

To preserve the tax-free treatment of the separation to Ralcorp and its shareholders, under the Tax Allocation
Agreement with Post Holdings, we will be prohibited from taking or failing to take any action that prevents the distribution and certain related transactions from being tax-free, and for the two-year period following the separation, we will be
subject to restrictions with respect to:



entering into certain transactions pursuant to which all or a portion of our equity securities or assets would be acquired, whether by merger or
otherwise, unless certain conditions are met;



issuing equity securities beyond certain thresholds;



certain repurchases of our common shares;



ceasing to actively conduct our business;



amendments to our organizational documents or taking any other action affecting the relative voting rights of our stock; or



merging or consolidating with any other person or liquidating or partially liquidating.

These restrictions may limit our ability during such period to pursue strategic transactions of a certain magnitude that involve the issuance or
acquisition of our stock or engage in new businesses or other transactions that might increase the value of our business. These restrictions may also limit our ability to raise significant amounts of cash through the issuance of stock, especially if
our stock price were to suffer substantial declines, or through the sale of certain of our assets.

ITEM 1B.

UNRESOLVED STAFF COMMENTS

Not applicable.

ITEM 2.

PROPERTIES

Our principal
properties are our manufacturing locations, both owned and leased, shown in the following table. Some properties include on-site warehouse space. We also lease our principal executive offices in St. Louis, MO, and we own research and development
facilities in Sauget, IL. Our leases are generally long-term. Certain of our owned real property are subject to mortgages or other applicable security interests. Management believes its facilities are suitable and adequate for the purposes for which
they are used and are adequately maintained. Generally, we believe each segments combination of facilities provides adequate capacity for current and anticipated future customer demand.

We are
a party to a number of legal proceedings in various federal, state and foreign jurisdictions. These proceedings are in varying stages and many may proceed for protracted periods of time. Some proceedings involve complex questions of fact and law.

In May 2009, a customer notified us that it was seeking to recover out-of-pocket costs and damages associated with the
customers recall of certain peanut butter-based products. The customer recalled those products in January 2009 because they allegedly included ingredients that had the potential to be contaminated with salmonella. The customers recall
stemmed from the U.S. Food and Drug Administration and other authorities investigation of Peanut Corporation of America, which supplied us with peanut paste and other ingredients. In accordance with our contractual arrangements with the
customer, the parties submitted these claims to mediation. In January 2011, we resolved all pending contractual and other claims, resulting in a payment by us of $5.0 million and an obligation to pay an additional $5.0 million, subject to the
customers completion of certain contractual obligations through February 2013. We accrued $7.5 million in the fiscal year ended September 30, 2010 based on early estimates of the settlement amount, and accrued an additional $2.5 million
in the quarter ended December 31, 2010.

Two of our subsidiaries are subject to three pending lawsuits brought by former
employees currently pending in separate California state courts alleging, among other things, that employees did not receive sufficient meal breaks resulting in incorrect wage statements, unpaid overtime and untimely payments to terminated
employees. Each of these suits was filed as a class action and seeks to include in the class certain current and former employees of the respective subsidiary involved. In each case, the plaintiffs are seeking unpaid wages, interest, attorneys
fees, compensatory and other monetary damages and injunctive relief. No determination has been made by either court regarding class certification and there can be no assurance as to whether a class will be certified or, if a class is certified, as
to the scope of such class. Our liability relating to these lawsuits cannot be reasonably estimated at this time; however, we do not expect that our ultimate liability, if any, will exceed $10.0 million.

From time to time, we are a party to various other legal proceedings. In the opinion of management, based upon the information presently
known, the ultimate liability, if any, arising from the pending legal proceedings, as well as from asserted legal claims and known potential legal claims which are likely to be asserted, taking into account established accruals for estimated
liabilities (if any), are not expected to be material individually and in the aggregate to our consolidated financial position, results of operations or cash flows. In addition, while it is difficult to estimate the potential financial impact of
actions regarding expenditures for compliance with regulatory matters, in the opinion of management, based upon the information currently available, the ultimate liability arising from such compliance matters are not expected to be material to our
consolidated financial position, results of operations or cash flows.

For a description of certain federal, state and local
proceedings involving environmental matters which were pending at September 30, 2011, see Governmental Regulation and Environmental Matters on page 7.

Our common stock is traded on the New York Stock Exchange under the symbol RAH. There were 8,364 shareholders of record on December 6, 2011. We have no plans to pay cash dividends in the
foreseeable future. The range of high and low sale prices of our common stock as reported by the NYSE is set forth in the table below.

Year Ended September 30,

2011

2010

High

Low

High

Low

First Quarter

$

65.61

$

58.05

$

60.81

$

52.66

Second Quarter

68.52

59.23

69.86

59.15

Third Quarter

91.35

67.28

68.24

54.71

Fourth Quarter

89.43

68.84

61.39

53.90

Issuer Purchases of Equity Securities

(c)

(d)

(a)

(b)

Total Number of Shares

Maximum Number

Total Number

Average

Purchased as Part of

of Shares that May Yet

of Shares

Price Paid

Publicly Announced

Be Purchased Under the

Period

Purchased*

per Share

Plans or Programs

Plans or Programs**

July 1 - July 31, 2011

0

$

0

0

See total

August 1 - August 31, 2011

3,486

75.50

0

See total

September 1 - September 30, 2011

8,762

74.11

0

See total

Total

12,248

$

74.51

0

5,000,000

*

On August 4, 2011 and September 23, 2011, 3,486 and 8,762 shares, respectively, were forfeited back to the Company in satisfaction of required taxes to be
withheld by federal, state and local governments in connection with the vesting of employee restricted stock awards.

**

On November 10, 2009, the Board of Directors authorized the repurchase up to 7,000,000 shares of common stock at prevailing market prices. The authorization has no
expiration date. From time to time, we may repurchase common stock through plans established under Rule 10b5-1. Typically, these plans direct a broker to purchase a variable amount of shares each day (usually between 0 and 50,000) depending on the
previous day's closing share price.

The following performance graph compares the changes, for the period indicated, in the cumulative total value of $100 hypothetically invested in each of (a) Ralcorp common stock, (b) the Russell
1000 index and (c) a peer group composed of 15 U.S.-based public companies in the food and consumer packaged goods industries. The companies are: Brown-Forman Corp.; Campbell Soup Co.; Church & Dwight Co. Inc.; The Clorox Co.;
Constellation Brands, Inc.; Corn Products Intl Inc.; Energizer Holdings, Inc.; Flowers Foods, Inc.; The Hershey Co.; Hormel Foods Corp; The J.M. Smucker Company; McCormick & Co.; Newell Rubbermaid Inc.; Snyders-Lance, Inc.; and
TreeHouse Foods Inc. Compared to last year, the peer group no longer includes Del Monte Foods Co., which is no longer a public company, and Seaboard Corp. and Spectrum Brands, Inc. were replaced by Snyders-Lance, Inc., which is now deemed to
be a more comparable peer company. These changes did not have a significant effect on the 5-year cumulative total return of the peer group.

For information about the impairment of intangible assets see Note 1 and Note 4 to the financial statements in Item 8 and Critical Accounting Policies and
Estimates in Item 7.

(c)

In fiscal 2011, Ralcorp incurred $4.1 of costs related to plant closures, accrued $2.5 related to the settlement of legal claims, and incurred merger and integration
costs of $1.9. In fiscal 2010, Ralcorp incurred professional services fees and severace costs related to fiscal 2010 acquisitions of $21.5. In addition, Ralcorp accrued $7.5 related to the potential settlement of legal claims. For more information
on acquisition-related costs and provision for legal settlement, see Note 3 and Note 16 to the financial statements in Item 8.

(d)

For information about the gain/loss on forward sale contracts, see Note 7 to the financial statements in Item 8.

(e)

During fiscal 2009, Ralcorp sold 7,085,706 of its shares of Vail Resorts for a total of $211.9. The shares had a carrying value of $141.3, resulting in a $70.6 gain.
During August and September 2008, Ralcorp sold 368,700 of Vail shares for a total of $13.7. The shares had a carrying value of $6.6, resulting in a $7.1 gain.

ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

The following discussion summarizes the significant factors affecting the consolidated operating
results, financial condition, liquidity, and capital resources of Ralcorp Holdings, Inc. This discussion should be read in conjunction with the financial statements under Item 8, especially the segment information in Note 20, and the
Cautionary Statement on Forward-Looking Statements on page 1. The terms we, our, Company, and Ralcorp as used herein refer to Ralcorp Holdings, Inc. and its consolidated subsidiaries. Sales
information for the base business, as reported herein, has been adjusted to exclude estimated current year sales attributable to recently acquired businesses for the period corresponding to the pre-acquisition period of the comparative
period of the prior year. For each acquired business, the excluded period starts at the beginning of the respective quarter or year-to-date period and ends one year after the acquisition date. We have included financial measures for our base
businesses (such as sales growth) because they provide useful and comparable trend information regarding the results of our businesses without the effects of the timing of acquisitions.

As discussed in more detail below, trends in our
results for the past three years were significantly affected by acquisitions, particularly American Italian Pasta Company (AIPC) in 2010 but also other businesses in 2010 and 2009, as well as impairments (including $503.5 million of impairment
charges in 2011) and items related to our former investment in Vail Resorts, Inc. (in 2009). The following table summarizes key data that we believe are important for you to consider as you read the consolidated results analysis discussions below.
In addition, please refer to Note 20 in Item 8 for data regarding net sales and profit contribution by segment.

Year Ended September 30,

2011

% Change

2010

% Change

2009

(dollars in millions, except per share data)

Net Sales

$

4,741.0

17

%

$

4,048.5

4

%

$

3,891.9

Operating Profit

29.8

-93

%

421.9

-6

%

448.3

Net (Loss) Earnings

(187.2

)

-190

%

208.8

-28

%

290.4

Diluted (Loss) Earnings per Share

$

(3.41

)

-191

%

$

3.74

-27

%

$

5.09

Adjusted Diluted Earnings per Share (1)

$

5.22

12

%

$

4.68

9

%

$

4.29

(1) Reconciliation to Diluted (Loss) Earnings per Share:

Adjusted Diluted Earnings per Share

$

5.22

$

4.68

$

4.29

Adjustments for economic hedges

(.33

)





Post separation costs

(.03

)





Merger and integration costs

(.02

)

(.37

)

(.35

)

Accelerated amortization of intangible assets

(.06

)





Impairment of intangible assets

(8.05

)

(.45

)



Provision for legal settlement

(.03

)

(.09

)



Amounts related to plant closures

(.05

)

(.03

)

(.01

)

Gain on forward sale contracts and sale of securities





.99

Equity in earnings of Vail Resorts, Inc.





.17

Effect of excluding potentially dilutive securities which were antidilutive for GAAP purposes due to net loss

(.06

)





Diluted (Loss) Earnings per Share

$

(3.41

)

$

3.74

$

5.09

Summary of 2011 Compared to 2010

Financial results in fiscal 2011 benefitted from volume and sales gains when compared to fiscal 2010, fueled by acquisitions (primarily AIPC, acquired in July 2010) and base-business sales growth. Despite
the top line revenue growth, the Company incurred an overall net loss of $187.2 million ($3.41 per diluted share) compared to net earnings of $208.8 million in fiscal 2010, as several items negatively impacted operating results relative to 2010.

Net earnings of $208.8 million ($3.74 per
diluted share) were down $81.6 million, as several items negatively impacted operating results when compared to 2009. These items include the absence of Vail-related gains (included in fiscal 2009 results), the impairment of goodwill and brand
trademarks, merger and integration costs, a provision for legal settlement and amounts related to plant closures. Excluding these items, adjusted diluted earnings per share increased 9% to $4.68 as the Company benefited from acquisitions, higher
overall base-business volumes, lower raw material costs, fewer outstanding shares as a result of share repurchases, and a lower effective tax rate. Partially offsetting these gains were lower net selling prices and higher interest and intangible
asset amortization expense associated with acquisitions.

Net sales increased $692.5 million or 17% compared to fiscal 2010 primarily as a result of recent
acquisitions, which added $555.5 million of sales in fiscal 2011. Excluding acquisitions, base-business net sales increased 3% as higher net selling prices more than offset a 2% decline in overall volumes. Net pricing in many of our product
categories increased as commodity costs rose significantly during the year. We further describe these and other factors affecting net sales in the segment discussions below.

Net sales increased $156.6 million or 4% compared to fiscal 2009 primarily as a result of recent
acquisitions, which added $244.1 million of sales in fiscal 2010. Excluding acquisitions, base-business net sales declined 2% as lower net selling prices and higher trade promotion spending on our branded cereal products more than offset a 1%
increase in overall volumes. Sales prices in many of our product categories declined as commodity costs fell during the first half of the fiscal year. We further describe these and other factors affecting net sales in the segment discussions below.

Gross profit margins were 26.2% in 2011, down from 26.6% recorded in 2010. Gross profit margins were adversely impacted by $28.9 million of net adjustments for economic hedges and, in fiscal 2010, a $3.9
million purchase accounting inventory adjustment related to AIPC. Excluding the effect of these items, adjusted gross profit margin increased from 26.7% in 2010 to 26.8% in 2011. This overall increase is primarily due to higher gross profit margins
for the Branded Cereal Products segment, driven by lower trade promotion spending, and the Frozen Bakery Products segment, where net selling price increases outpaced rising commodity costs in the current year in response to anticipated additional
raw material cost increases in fiscal 2012. The Company also benefited from an additional ten months of results from the higher-margin pasta business. These increases were partially offset by decreased gross profit margins in the Other Cereal
Products and Snacks, Sauces & Spreads segments, where the effect of higher commodity costs exceeded the benefit of higher net selling prices.

Selling, general and administrative expenses (SG&A) as a percentage of net sales declined from 13.1% in 2010 to 13.0% in 2011. The SG&A percentage was negatively impacted by merger and integration
costs in both periods (especially 2010) and Post separation costs in 2011. Excluding the effects of these items, the adjusted SG&A percentage decreased from 12.9% in 2010 to 12.8% in 2011. SG&A was positively impacted by an additional ten
months of AIPC results (which has a lower SG&A cost structure) and lower information systems project related costs. Partially offsetting these favorable impacts were increased advertising expense in the Branded Cereal Products segment, higher
incentive compensation expense (including cash-based incentive compensation, stock-based compensation, and mark-to-market adjustments for stock-based deferred compensation), unfavorable foreign exchange rates in Canada, and increased insurance
reserves at our wholly owned insurance subsidiary associated with a supplier quality issue.

Total amortization expense for the current year was $78.2 million ($.90 per adjusted diluted
share) compared to $49.3 million ($.56 per share) last year. The increase is primarily due to ten additional months of amortization of AIPC intangible assets and the accelerated amortization of a customer relationship intangible asset due to a
shortened estimate of the remaining life of the relationship.

Overall operating profit margins decreased from 10.4% in fiscal
2010 to .6% in fiscal 2011. The operating profit margin was affected in both years by impairments of intangible assets, merger and integration costs (particularly in the 2010), provision for legal settlement, and costs related to plant closures, and
in 2011 by adjustments for economic hedges, Post separation costs, and accelerated amortization of intangible assets. See additional discussions of many of these items below. Excluding the effects of these items, adjusted operating profit margins
declined from 12.5% to 12.2%.

2010 Compared to 2009

Gross profit margins were 26.6% in 2010, down from 27.2% registered in 2009. Gross profit margins were adversely impacted by a negative sales mix (lower sales of higher-margin Branded Cereal Products),
higher trade promotion spending for Branded Cereal Products, lower net selling prices and a $3.9 million purchase accounting inventory adjustment related to the AIPC acquisition. Overall raw material costs were lower than fiscal 2009, as costs for
key commodities including grain, oils, and peanuts declined during the first half of 2010.

SG&A as a percentage of net
sales decreased from 14.5% in 2009 to 13.0% in 2010. Key drivers of the reduction include a favorable sales mix (shifting primarily from the Branded Cereals segment to Snacks, Sauces and Spreads and Pasta), lower advertising expense for our cereal
businesses (down $33.3 million), significantly lower Post integration costs compared to prior year and favorable foreign exchange rates in Canada. Fiscal 2009 included $29.5 million of Post transition and integration costs compared to $6.4 million
in 2010.

Despite the modest decline in gross profit margin and the improvement in the SG&A percentage, operating profit
margins declined from 11.5% in fiscal 2009 to 10.4% in 2010. Fiscal 2010 operating profit was negatively impacted by the impairment of intangible assets (both brand trademarks and goodwill), merger and integration costs, a provision for legal
settlement, and plant closure costs. See additional discussions of many of these items below. Excluding these items, adjusted operating profit margins improved from 12.3% to 12.5%.

Adjustments for Economic Hedges

Certain derivative contracts do not
qualify for cash flow hedge accounting but are used as economic hedges of our exposure to changes in commodity costs. Realized and unrealized gains and losses on such contracts are recognized at a corporate level in earnings but not allocated to
affect segment profit until the hedged exposure affects earnings. In fiscal 2011, net mark-to-market losses on such derivatives totaled $33.1 million, and $4.2 million was reclassified to segment profit, resulting in a net adjustment for economic
hedges of $28.9 million. This net adjustment was recognized in cost of goods sold on the statement of earnings but excluded from segment profit and our non-GAAP measures of Adjusted EBITDA and Adjusted Diluted Earnings per Share. There were no such
derivative contracts during fiscal 2010.

Post Separation Costs

In fiscal 2011, we incurred $2.8 million of costs (primarily professional service fees) related to the planned separation of the Post
cereals business from the other Ralcorp businesses. Post separation costs are included in Selling, general & administrative expenses.

Merger and Integration Costs

During the years ended September 30,
2011 and 2010, Ralcorp recorded approximately $2.5 million and $33.1 million, respectively of expenses related to acquisition activity. During 2011, those costs relate primarily to the acquisition of Sara Lees North American refrigerated dough
business, completed on October 3, 2011. In 2010, those expenses included professional services fees and a one-time finished goods inventory revaluation adjustment related to the AIPC transaction, as well as Post Foods transition and integration
costs, and severance costs related to all four fiscal 2010 acquisitions.

We also incurred significant costs in fiscal 2009 related to the integration of Post Foods
following the August 2008 acquisition. The costs included transitioning Post Foods into Ralcorp operations, including decoupling the cereal assets of Post Foods from those of other operations of Kraft Foods Inc. (the former owner), developing
stand-alone Post Foods information systems, developing independent sales, logistics and purchasing functions for Post Foods, and other significant integration undertakings. While a portion of those costs were capitalized, the expense portion totaled
$32.0 million in 2009.

These merger and integration costs were included in the statements of operations as follows:

2011

2010

2009

Cost of goods sold

$



$

5.2

$

2.5

Selling, general and administrative expenses

.6

6.4

29.5

Other operating expenses, net

1.9

21.5



$

2.5

$

33.1

$

32.0

Impairment of Intangible Assets

We perform an assessment of indefinite life assets (including goodwill and brand trademarks) during the fourth quarter in conjunction with the annual forecasting process. In addition, intangible assets
are reassessed as needed when information becomes available that is believed to negatively impact the fair market value of an asset.

In the third quarter of 2011, a non-cash trademark impairment charge of $32.1 million was recognized in the Branded Cereal Products segment related to the Post Shredded Wheat and Grape-Nuts trademarks
based on reassessments triggered by the announced separation of Post Foods from Ralcorp. The trademark impairment was due to reductions in anticipated future sales as a result of competition and a reallocation of advertising and promotion
expenditures to higher-return brands.

In the fourth quarter we recorded additional non-cash impairment charges totaling
$471.4 million related to intangible assets in the Branded Cereal Products segment. These charges consisted of a goodwill impairment of $364.8 million and trademark impairment charges of $106.6 million (primarily related to the Honey Bunches of
Oats, Post Selects, and Post trademarks). Based upon a preliminary review of the Post cereal business conducted by the newly appointed Post management team in October 2011, sales declines in the fourth quarter and continuing into October, and
weakness in the branded ready-to-eat cereal category and the broader economy, we determined that additional strategic steps were needed to stabilize the business and the competitive position of its brands. The impact of these steps is the reduction
of expected net sales growth rates and profitability of certain brands in the near term, thereby resulting in the goodwill and trademark impairments.

During fiscal 2010, we recorded non-cash impairment charges totaling $39.9 million related to intangible assets. In the second quarter, a goodwill impairment charge of $20.5 million was recognized in the
Snacks, Sauces & Spreads segment related to the Linette chocolate reporting unit. The impairment resulted from reduced sales to a major customer, the inability to quickly replace the lost volume (including a decision by a major retailer to
delay potential new product offerings), and changes in anticipated ingredient cost trends, leading to shortfalls in earnings before interest, income taxes, depreciation and amortization relative to forecasts. In the fourth quarter, a trademark
impairment loss of $19.4 million was recognized in the Branded Cereal Products segment related to the Post Shredded Wheat and Grape-Nuts trademarks. The trademark impairment was due to a reallocation of advertising and promotion expenditures to
higher-return brands and reductions in anticipated sales-growth rates based on the annual forecasting process completed in the fourth quarter.

See further discussion of impairments under Critical Accounting Policies and Estimates below.

Provision for Legal Settlement

We recorded a charge of $2.5 million and
$7.5 million during fiscal 2011 and 2010, respectively in connection with the settlement of certain contractual claims by a customer in the Other Cereal Products segment, included in Other operating expenses, net on the statement of
operations. Those claims arose primarily as a result of the customers recall of certain peanut-butter-based products in January 2009 stemming from the U.S. Food and Drug Administration and other authorities investigation of Peanut
Corporation of America, which supplied us with peanut paste and other ingredients. In January 2011, Ralcorp resolved all pending contractual and other claims, resulting in a payment by the Company of $5.0 million and an obligation to pay an
additional $5.0 million, subject to the customers completion of certain contractual obligations through February 2013. For more information on the provision for legal settlement refer to Note 16 in Item 8.

Net interest expense increased $26.2 million or 24% to $134.0 million in 2011. The increase is due to a $677.2 million increase in our weighted-average outstanding borrowings compared to the year ended
September 30, 2010. The weighted-average interest rate on all of the Companys outstanding debt was 5.5% at the end of fiscal 2011.

Net interest expense increased $8.8 million or 8.9% to $107.8 million in 2010. The increase is due to a $981.1 million increase in outstanding debt since September 30, 2009. To help finance the AIPC
acquisition, we incurred approximately $1.1 billion of debt in July 2010 with a weighted-average interest rate of approximately 3.8%. The weighted-average interest rate on all of the Companys outstanding debt was 6.2% at the end of fiscal
2010.

Items Related to Former Investment in Vail Resorts, Inc.

Net earnings in fiscal 2009 were affected by non-cash gains on forward sale contracts related to some of our shares of Vail Resorts, Inc.
All contracts were settled during fiscal 2009. The contracts included a collar on the Vail stock price and the prepayment of proceeds at a discount (whereby we received a total of $140.0 million). Because we accounted for our investment in Vail
Resorts using the equity method, these contracts, which were intended to hedge the future sale of those shares, were not eligible for hedge accounting. Therefore, gains or losses on the contracts were immediately recognized in earnings. For more
information on these contracts, see Note 7 in Item 8.

During fiscal 2009, we sold our remaining 7,085,706 shares of Vail
Resorts, Inc. common stock for a total of $211.9 million. The shares had a carrying value of $141.3 million, resulting in a $70.6 million gain.

Income Taxes

Income
taxes for fiscal 2011 decreased $22.3 million or 21% from 2010, driven primarily by lower earnings. Our effective tax rate for fiscal 2011 was adversely impacted by a $364.8 million goodwill impairment charge, which is not deductible for tax return
purposes (i.e., a permanent difference item) that does not impact income tax expense. Excluding the impact of this item, our blended effective tax rate for fiscal 2011 was 31.8% compared to 33.5% for fiscal 2010. The rate for both years was reduced
by the effects of adjustments to current and deferred income tax assets and liabilities to revise the estimates previously recorded to the actual amounts per subsequent tax return filings for the prior year, including the effects of lower than
anticipated effective state rates. In addition, for fiscal 2011, the federal Domestic Production Activities Deduction established by the American Jobs Creation Act of 2004 increased from 6% to 9% of qualifying taxable income. The effect
of that increase was a reduction in our federal effective rate of approximately 1 percentage point. We currently expect our fiscal 2012 overall effective tax rate to be approximately 35.5%.

For 2010, income taxes declined $51.6 million or 32.9% from 2009, driven primarily by the absence of Vail-related gains (as described
above). Our blended effective tax rate for fiscal 2010 was 33.5% compared to 35.9% for fiscal 2009. The 2010 rate was reduced by the effects of adjustments to current and deferred income tax assets and liabilities to revise the estimates previously
recorded to the actual amounts per subsequent tax return filings for fiscal 2009, including the effects of lower than anticipated effective state rates and the final tax effects of the sale of Vail shares (described in Note 6).

Non-GAAP Measures

The non-GAAP financial measures presented herein and discussed below do not comply with accounting principles generally accepted in
the United States, or GAAP, because they are adjusted to exclude (include) certain cash and non-cash income and expenses that would otherwise be included in (excluded from) the most directly comparable GAAP measure in the statement of operations.
These non-GAAP financial measures, which are not necessarily comparable to similarly titled captions of other companies due to potential inconsistencies in the methods of calculation, should not be considered an alternative to, or more meaningful
than, related measures determined in accordance with GAAP. As further discussed below, these non-GAAP measures supplement other metrics used by management and investors to evaluate the businesses and facilitate comparison of operations over time.



Base-business net sales, as reported herein, has been adjusted to exclude estimated current year sales attributable to recently acquired businesses for
the period corresponding to the pre-acquisition period of the comparative period of the prior year. For each acquired business, the excluded period starts at the beginning of the most recent fiscal year being compared and ends one year after the
acquisition date. The Company has included financial measures for the base business (such as sales growth) because they provide useful and comparable trend information regarding the results of our businesses without the effect of the timing of
acquisitions.

Total segment profit is an accumulation of the GAAP measures of profit for each reportable segment that are reported to the chief operating decision
maker for purposes of making decisions about allocating resources to each segment and assessing its performance, which gives investors a combined measure of these key amounts.



Adjusted EBITDA, as presented herein (and reconciled to Net (Loss) Earnings below), is defined as earnings before interest, income taxes, depreciation,
and amortization, excluding impairment of intangible assets (if any), adjustments for economic hedges, provision for legal settlement, merger and integration costs, Post separation costs, amounts related to plant closures, and other gains and losses
related to the Companys former investment in Vail Resorts, Inc. Ralcorps board of directors, management, and investors use Adjusted EBITDA to assess the Companys performance because it allows them to compare operating performance
on a consistent basis across periods by removing the effects of capital structure (such as varying levels of interest expense), items largely outside the control of the management team (such as income taxes), asset base (such as depreciation,
amortization, and impairments), derivatives accounting that is not representative of the economic effect of hedges, amounts related to significant legal settlements, items related to the Companys former investment in Vail Resorts, Inc., and
items related to acquisition and disposal activity (such as merger and integration costs, Post separation costs, and amounts related to plant closures).



Adjusted diluted earnings per share is an additional measure to help investors compare the earnings generated by operations between periods, without
the effects of intangible asset impairments and accelerated amortization (if any), adjustments for economic hedges, provision for legal settlement, merger and integration costs, Post separation costs, amounts related to plant closures, and items
related to the Companys former investment in Vail Resorts, Inc.



Adjusted gross profit (as a percentage of net sales) is an additional measure to help investors compare gross margins between periods, without the
effects of adjustments for economic hedges, merger and integration costs, and acquired inventory valuation adjustments (if any).



Adjusted selling, general & administrative expenses (as a percentage of net sales) is an additional measure to help investors compare these
expenses between periods, without the effects of merger and integration costs and Post separation costs.



Adjusted operating profit (as a percentage of net sales) is an additional measure to help investors compare operating margins between periods, without
the effects of intangible asset impairments and accelerated amortization, adjustments for economic hedges, provision for legal settlement, merger and integration costs, Post separation costs, amounts related to plant closures, and items related to
the Companys former investment in Vail Resorts, Inc.

Year Ended September 30,

2011

2010

2009

(dollars in millions)

Adjusted EBITDA

$

800.2

$

671.7

$

625.5

Interest expense, net

(134.0

)

(107.8

)

(99.0

)

Income taxes

(83.0

)

(105.3

)

(156.9

)

Depreciation and amortization

(226.5

)

(166.8

)

(144.7

)

Adjustments for economic hedges

(28.9

)





Post separation costs

(2.8

)





Merger and integration costs

(2.5

)

(33.1

)

(32.0

)

Impairment of intangible assets

(503.5

)

(39.9

)



Provision for legal settlement

(2.5

)

(7.5

)



Amounts related to plant closures (excluding depreciation)

(3.7

)

(2.5

)

(.5

)

Gain on forward sale contracts and sale of securities





88.2

Equity in earnings of Vail Resorts, Inc., net of related deferred income taxes

Net sales in the Branded Cereals Segment decreased $33.7 million or 3% in fiscal 2011. The decline in sales was primarily due to lower volumes (down 10%) across most of the Post brand portfolio with the
exception of Great Grains, which grew 14% driven by the increased advertising support. Partially offsetting these declines were improved net selling prices resulting from reduced trade spending levels compared to the aggressive levels a year ago in
response to competitive promotional activity in the ready-to-eat cereal category. The reduced trade spending levels are part of a continuing focus on more efficient trade program investments.

Net sales in the Branded Cereals Segment decreased $83.1 million or 8% in fiscal 2010. The decline in sales was due to lower volumes (down
2%) and lower net selling prices as a result of increased trade promotion spending when compared to fiscal 2009. Partially offsetting these declines were sales from new product extensions within the Honey Bunches of Oats and Pebbles brands as well
as a 7% volume gain for Honey Bunches of Oats. The ready-to-eat cereal category, which includes Post brand cereals, declined in the low single digits during the fiscal year, as all branded competitors aggressively used trade promotions to compete on
pricing and protect market share.

Net sales in the Other Cereal Product segment were $838.5 million in fiscal 2011, up $38.8 million from the prior year, driven by strong volume growth in nutritional bars (up 12%) and improved selling
prices across the segment portfolio in response to rising commodity costs. Overall ready-to-eat cereal volumes declined 2% compared to the prior year, as lower volumes in the first half of fiscal 2011 were partially offset by 2% volume growth in the
second half of the year, driven by strong retail promotional activity and improved overall trends for private-brand products.

Segment profit for fiscal 2011 was $86.3 million, down $4.0 million or 4% from fiscal 2010 as increased sales did not completely offset
higher raw material costs (driven by wheat, oats, fruit, and nuts), increased production costs (primarily nutritional bars), and a slightly unfavorable product mix resulting from a shift to lower-margin nutritional bars.

2010 Compared to 2009

Net sales in the Other Cereal Product segment were $799.7 million in fiscal 2010, down $3.6 million from the prior year, as lower volumes
(down 3%) offset higher net selling prices and a favorable product mix (shift from ready-to-eat cereals to nutritional bars). The lower overall volumes are mainly attributable to single-digit declines in private-brand ready-to-eat (RTE) cereals, as
increased promotional spending by branded competitors negatively impacted private-brand volumes, as well as declining RTE co-manufacturing volumes (included in Other minor categories). Partially offsetting these declines were strong
volume gains in nutritional bars, which grew 21% in fiscal 2010, though at a slightly lower net selling price than prior year due to decreasing commodity prices.

The segments profit contribution for fiscal 2010 was $90.3 million, down $1.7 million
or 2% from fiscal 2009. However, the segments operating profit margin of 11% was unchanged from fiscal 2009 as lower volumes and higher input costs were offset by higher selling prices and lower operating expenses (notably advertising and
distribution costs).

Snacks, Sauces & Spreads

Base-business volume changes were as follows:

Sales Volume Changefrom Prior Year

2011

2010

Nuts

2

%

7

%

Crackers

0

%

-2

%

Cookies

-6

%

-6

%

Peanut butter

1

%

14

%

Preserves & jellies

-5

%

4

%

Syrups

-9

%

3

%

Chips

3

%

-1

%

Dressings

9

%

5

%

Other minor categories

-2

%

9

%

Total

-2

%

4

%

2011 Compared to 2010

Net sales for the Snacks, Sauces and Spreads segment increased $141.1 million, or 10%, to $1,602.7 million in fiscal 2011. The overall increase when compared to fiscal 2010 is primarily due to increased
selling prices resulting from higher raw material costs, a favorable sales mix, as well the acquisitions of J.T. Bakeries and North American Baking in May 2010, which accounted for $67.2 million of the year over year increase. Excluding
acquisitions, net sales increased $73.9 million, as a 2% decline in volume was offset by higher net selling prices.

Segment
operating profit decreased $17.1 million, or 11%, from $152.6 million in fiscal 2010 to $135.5 million in fiscal 2011. The decrease in operating profit was driven by significantly higher commodity costs (primarily cashews, peanuts, and tree nuts,
but also including oils, wheat, and packaging) as well as unfavorable freight costs. These negative impacts were partially offset by improved net pricing, a favorable product mix, lower manufacturing and selling, general, and administrative costs,
as well as the results from fiscal 2010 acquisitions. The favorable mix was driven by increased volumes for (higher-margin) spoonable dressings, Mexican sauces, and specialty crackers and cookies and decreased volume for (lower-margin) cashews.

2010 Compared to 2009

Net sales for the Snacks, Sauces and Spreads segment increased $138.4 million, or 10%, to $1,461.6 million in fiscal 2010. The overall increase when compared to fiscal 2009 is primarily due to the
acquisitions of Harvest Manor in March 2009 and J.T. Bakeries and North American Baking in May 2010, which accounted for $131.9 million of the year over year increase. Excluding acquisitions, net sales increased $6.5 million, as a 4% improvement in
volume was offset by lower net selling prices. Volumetric trends were positive for most of the segments major product categories, with notable increases for peanut butter and snack nuts. Partially offsetting these gains were lower overall
volumes for crackers and cookies, mainly attributable to lower sales to a significant retail customer.

Segment operating
profit increased $35.0 million, or 30%, from $117.6 million in fiscal 2009 to $152.6 million in fiscal 2010. The increase in operating profit was driven by acquisitions, increased overall volumes, lower raw material costs (including oils, peanuts,
wheat and packaging) and freight, partially offset by lower net selling prices, a shift in sales from higher-margin crackers and cookies to lower-margin snack nuts, and higher operating expenses (up 4% excluding acquisitions). As a result of these
and other factors, the segments profit margin increased from 9% in fiscal 2009 to 10% in fiscal 2010.

Net sales of the Frozen Bakery Products segment increased $70.3 million, or 10%, when compared to fiscal 2010. The overall increase is attributable to volume gains in foodservice, retail griddle products,
and in-store bakery cakes, as well as higher pricing to cover commodity cost increases and incremental sales from the June 2010 acquisition of Sepps Gourmet Foods Ltd., which added $25.0 million in sales. These gains were partially offset by
the effects of volume declines in the in-store bakery channel, frozen dough, and bread. Strong sales growth in the retail channel was fueled by new griddle products distributed through two major retailers. Foodservice sales benefited from a new
product for a major restaurant chain and volume growth at food distributers.

Segment operating profit increased $7.2 million,
or 9%, to $88.0 million in fiscal 2011 as a result of new business volume, increased net selling prices, incremental results from the 2010 acquisition of Sepps Gourmet Foods Ltd. (which accounted for $2.3 million of the increase), and lower
supply chain and general and administrative costs. These favorable impacts were offset by higher raw material (primarily flour, oil, dairy and sweeteners), freight, and warehousing costs as well as an $8.1 million unfavorable effect of foreign
exchange rate changes.

Segment operating profit increased $11.7 million, or 17%, to $80.8 million in fiscal 2010, boosting segment profit
margins from 10% in fiscal 2009 to 12% in fiscal 2010. The profit improvement was fueled by lower raw material costs (notably grains and oils), increased retail volume (partially due to the Sepps acquisition), and favorable Canadian foreign
exchange rates. These positive effects were partially offset by higher production costs as a result of overtime incurred to meet the increased demand for griddle products, and lower net selling prices.

Pasta

The Pasta
segment consists of American Italian Pasta Company (AIPC), which Ralcorp acquired on July 27, 2010. Net sales in fiscal 2011 were up $476.0 million from last year primarily as a result of ten additional months of results in the current year.
Comparing only the corresponding two-month periods of each year, base-business net sales increased 13% due to higher net selling prices (in response to rising raw material costs) which more than offset a 4% base-business volume decline. Retail sales
volume was down 3% due to declines in domestic and international private-brand products as well as branded products. Last year, AIPC exited certain geographic markets where the brands were underperforming the market and shifted focus to
private-brand products. Institutional volumes declined 8%, primarily as a result of lower ingredient sales (which have a significantly lower margin than other sales categories). For the full year ended September 30, 2011 compared to the full
year ended September 30, 2010 (including the pre-acquisition period), net sales were up 2% despite 3% lower volumes due to improved net selling prices.

Segment profit was up $104.5 million, primarily due to the additional ten months of results
in the current year compared to the prior year. For the comparable two-month periods of each year, base-business segment profit increased 20% driven by improved net selling prices (compensating for increased raw material costs), lower freight costs,
and lower manufacturing costs, partially offset by significantly higher raw material costs (primarily durum and semolina wheat).

LIQUIDITY AND CAPITAL RESOURCES

Historically, we have funded operating needs by generating positive cash flows through operations. We expect to continue generating operating cash flows through our mix of businesses and expect that
short-term and long-term liquidity requirements will be met through a combination of operating cash flows and strategic use of borrowings under committed and uncommitted credit arrangements. To help ensure sufficient liquidity, we continue to
monitor market events and the financial institutions associated with our credit facilities, including monitoring credit ratings and outlooks, capital raising and merger activity. The following tables show recent cash flow and capitalization data,
which is discussed below.

Year Ended September 30,

2011

2010

2009

(dollars in millions)

Cash provided by operating activities

$

505.7

$

301.9

$

326.7

Cash used by investing activities

(138.8

)

(1,438.4

)

(90.2

)

Cash (used) provided by financing activities

(344.5

)

881.5

29.9

Effect of exchange rate changes on cash

(1.7

)

1.5

2.3

Net increase (decrease) in cash and cash equivalents

$

20.7

$

(253.5

)

$

268.7

September 30,

2011

2010

2009

(dollars in millions)

Cash and cash equivalents

$

50.0

$

29.3

$

282.8

Current portion of long-term debt

30.7

173.2

45.6

Working capital excluding cash and current debt

303.5

393.8

238.0

Long-term debt excluding current portion

2,172.5

2,464.9

1,611.4

Total shareholders equity

2,619.2

2,829.2

2,705.6

Capital resources remained strong at September 30, 2011, with a long-term debt to total capital
(which is the total of long-term debt and total shareholders equity) ratio of 45%, compared to 47% for September 30, 2010. Cash on hand increased from the end of fiscal 2010, while the current portion of long-term debt decreased
significantly as we repaid the majority of short-term borrowings made during the fourth quarter of 2010. Working capital excluding cash and cash equivalents and the current portion of long-term debt decreased from September 30, 2010 to
September 30, 2011, primarily as a result of a $105.0 million increase in notes payable under our accounts receivable securitization program (see Note 11 in Item 8), a $50.5 million increase in hedging-related liabilities, and an $7.4
million decrease in our income taxes receivable, partially offset by an increase in inventories ($65.6 million) and the effects of the timing of payments and sales.

Operating Activities

2011 Compared to 2010

The increase in net cash provided by operating activities for the year ended September 30, 2011 is primarily attributable to higher
segment operating profit before depreciation and amortization expense. Operating cash flows were also positively impacted by a reduction in merger and integration costs (approximately $30 million), an $18.6 million deferred gain on an interest rate
swap settlement, a $29.1 million reduction in interest payments, $13.6 million payment in 2010 to Kraft, a $10 million decrease in pension contributions, and a favorable $38.6 million change in cash flows related to income taxes, partially offset by
higher inventory levels (net of accounts payable). We made a $20.0 million contribution to our qualified pension plan in 2011 compared to $30.0 million in 2010. As a result of a $677.2 million increase in our weighted average outstanding borrowings,
we paid $136.3 million of interest in 2011 compared to $107.2 million in 2010.

The decrease in net cash provided by operating activities for the year ended September 30, 2010 is primarily attributable to the increases in working capital excluding cash and current debt
(excluding the effects of business acquisitions), the amount of pension contributions, and incremental interest payments, partially offset by an increase in total segment profit before depreciation and amortization expense. We made a $30.0 million
contribution to our qualified pension plan in 2010 compared to $5.0 million in 2009. As a result of increased debt (discussed below), we paid $107.2 million of interest in 2010 compared to $98.7 million in 2009. The factors contributing to our
improved total segment profit are discussed in Segment Results above.

Investing Activities

Net cash paid for business acquisitions totaled zero in fiscal 2011, $1.3 billion in fiscal 2010 (J.T. Bakeries, North American Baking,
Sepps Gourmet Foods, and AIPC), and $55 million in fiscal 2009 (Harvest Manor). While the fiscal 2010 transactions were largely financed with debt (see Financing Activities below), more than $100 million was funded with cash on
hand. See Note 3 in Item 8 for more information about these acquisitions.

Capital expenditures were $141.1 million,
$128.9 million, and $115.0 million in fiscal years 2011, 2010, and 2009, respectively. Expenditures in these three years included information systems projects and special projects at the recently acquired businesses, as well as systems conversion
costs for some of our other businesses. Capital expenditures for fiscal 2012 are expected to be $265-$275 million (including maintenance expenditures of approximately $45 million). As discussed below, we have adequate capacity under current
borrowing arrangements, in addition to cash on hand, to meet these cash needs.

During 2009, we sold 2,692,443 shares of Vail
common stock and received proceeds of $82.4 million. As of September 30, 2009, we no longer owned any shares of Vail common stock.

Financing Activities

On
May 28, 2009, we issued Fixed Rate Senior Notes, Series 2009A and Series 2009B, totaling $100 million, with $50 million due in 2019 and $50 million due in 2021. On August 14, 2009, we issued Fixed Rate Senior Notes totaling $300 million
due in 2039. On July 26, 2010, we issued Fixed Rate Senior Notes totaling $300 million due in 2020 and Fixed Rate Senior Notes totaling $150 million due in 2039. On July 27, 2010, we entered into a $500 million credit facility maturing in
2015 and drew the full amount. In December 2010, we entered into uncommitted credit arrangements with banks totaling $150 million and expiring in December 2011. Total remaining availability under our $300 million revolving credit agreement and our
$150 million uncommitted credit arrangements was $430.1 million at September 30, 2011.

In December 2009, $29.0 million
of Series B and $10.7 million of Series D were repaid as scheduled. In fiscal 2010, $29 million of Series B, $10.7 million of Series D, and the entire $5.6 million IRB were repaid as scheduled, and the remaining $50 million of Series G was repaid
prior to its maturity date of February 2011. In fiscal 2011, we repaid the final $29 million of Series B, $10.7 million of Series D, and $10 million of the term loan component of the new $500 million credit facility. In fiscal 2012, we must repay
another $10.7 million of Series D, and $20 million of the term loan component of the new $500 million credit facility.

The
$450 million of Senior Notes maturing in 2039 and the $300 million of Senior Notes maturing in 2020 do not contain financial covenants. All of our other notes provide that, if we elect to pay additional interest, our ratio of total debt to pro forma
adjusted EBITDA (as defined in the debt agreements) may exceed the 3.5 to 1 limit, but be no greater than 4 to 1, for a period not to exceed 12 consecutive months. Covenants in our 2010 revolving credit agreement require that this ratio not exceed
3.75 to 1. As of September 30, 2011, this leverage ratio was approximately 3.0 to 1, and we were also in compliance with all other covenants for all of our debt. Our long-term goal is a leverage ratio of between 2.5 and 3 times.

Supplementing our available borrowing capacity, under the agreement described under Off-Balance Sheet Financing below, we
could choose to sell up to $135 million of ownership interests in accounts receivable, but we had sold only $105.0 million of such interests as of September 30, 2011. To date, we have not experienced a disruption in the market for our secured
receivables-based financing. In the event of such disruption, we presently have sufficient borrowing capacity under our committed revolving credit agreement.

In fiscal 2010, we repurchased two million shares of Ralcorp stock for $115.5 million, and the Board of Directors has authorized us to repurchase up to five million additional shares. In fiscal 2011,
12,248 shares were forfeited back to the Company in satisfaction of required taxes to be withheld by federal, state, and local governments in connection with the vesting of employee restricted stock awards.

In July 2011, the Company announced that its board of directors has agreed in principle to
separate Post Holdings, Inc., an entity that will own Post branded ready-to-eat cereal products business, from other businesses in a tax-free spin-off to shareholders. The separation plan is subject to final approval by the board of directors, other
customary approvals, and the receipt of an IRS tax ruling. At or prior to this spin-off in fiscal 2012, we expect Post to issue debt of approximately $950 million, with cash proceeds of approximately $900 million going to Ralcorp. We expect to use
that cash for debt repayment and other general corporate purposes. Following the separation, the Company will own no more than 20% of Posts common stock for a limited period of time and also provide administrative support to Post through a
transition services agreement.

Off-Balance Sheet Financing

As an additional source of liquidity, on September 24, 2001, Ralcorp entered into an agreement to sell, on an ongoing basis, all of its trade accounts receivable to a wholly owned, bankruptcy-remote
subsidiary called Ralcorp Receivables Corporation (RRC). RRC entered into a related arrangement giving it the ability to sell undivided percentage ownership interests in qualifying receivables to a bank commercial paper conduit (the Conduit). As of
September 30, 2011, the accounts receivable of Medallion, Western Waffles, Bloomfield Bakers, Post Foods Canada, J.T. Bakeries, North American Baking, Sepps Gourmet Foods, and AIPC businesses had not been incorporated into the sale
agreement and were not being sold to RRC. In November 2010, Post Foods (U.S.), Cottage Bakery, and Harvest Manor were added to the agreement and the maximum amount that RRC can sell to the Conduit was increased from $75 million to $135 million.
Covenants in the agreement include requirements that EBIT be at least three times Consolidated Interest Expense, and that Total Debt not exceed 3.75 times Adjusted EBITDA (each term as defined in the
agreement). RRCs only business activities relate to acquiring and selling interests in Ralcorps receivables. Upon the agreements termination, the Conduit would be entitled to all cash collections on RRCs accounts receivable
until its purchased interest has been repaid. The agreement is renegotiated and extended periodically (generally on an annual basis) and will terminate in May 2012, unless again extended.

Through September 30, 2010, the trade receivables sale arrangement with RRC represented off-balance sheet financing
since the sale resulted in assets being removed from our balance sheet rather than resulting in a liability to the Conduit. The organizational documents of RRC and the terms of the agreements governing the receivables sale transactions made RRC a
qualifying special purpose entity. As such, it was not to be consolidated in Ralcorps financial statements under generally accepted accounting principles. Furthermore, the true sale nature of the arrangement required
Ralcorp to account for RRCs transactions with the Conduit as a sale of accounts receivable instead of reflecting the Conduits net investment as debt with a pledge of accounts receivable as collateral. As a result of ASUs 2009-16 and
2009-17, which were effective for Ralcorp as of October 1, 2010, the financial statement presentation of the receivables sale arrangement has changed such that it no longer represents off-balance sheet financing. Beginning in fiscal
2011, the outstanding balance of receivables remained on Ralcorps balance sheet, proceeds received from the Conduit ($105 million and zero as of September 30, 2011 and 2010, respectively) were shown as short-term debt, and there was no
investment in RRC. See further discussion in Note 2 and Note 11 in Item 8.

In the normal course of business, we enter into contracts and commitments which obligate us to make payments in the future. The table below sets forth our significant future obligations by time period as
of September 30, 2011.

Total

Less Than1 Year

1-3Years

3-5Years

More Than5 Years

(dollars in million)

Long-term debt obligations (a)

$

3,699.5

$

159.7

$

441.8

$

496.3

$

2,601.7

Operating lease obligations (b)

86.7

15.9

22.9

18.7

29.2

Purchase obligations (c)

781.2

696.9

81.6

1.6

1.1

Deferred compensation obligations (d)

40.4

13.5

12.4

4.8

9.7

Benefit obligations (e)

404.1

13.7

29.5

34.9

326.0

Unrecognized tax benefits (f)

5.6

.9

4.7





Total

$

5,017.5

$

900.6

$

592.9

$

556.3

$

2,967.7

(a)

Long-term debt obligations include principal payments and interest payments based on interest rates at September 30, 2011. See Note 15 in Item 8 for details.

Purchase obligations are legally binding agreements to purchase goods or services that specify all significant terms, including: fixed or minimum quantities to be
purchased; fixed, minimum or variable price provisions; and the approximate timing of the transaction.

(d)

Deferred compensation obligations have been allocated to time periods based on existing payment plans for terminated employees and the estimated timing of distributions
to current employees based on age.

(e)

Benefit obligations consist of future payments related to pension and other postretirement benefits as estimated by an actuarial valuation.

(f)

Unrecognized tax benefits for uncertain tax positions and related accrued interest have been allocated to time periods based on the estimated timing of resolution with
the taxing authority.

INFLATION

While we recognize that inflationary pressures have had an adverse effect on the Company through higher raw material and fuel costs, as discussed above, it is our view that inflation has not had a
material adverse impact on operations in the three years ended September 30, 2011, but could have a material impact in the future if inflation rates were to significantly exceed our ability to achieve price increases.

CURRENCY

Certain sales and costs of our Canadian and Italian operations are denominated in Canadian dollars and Euros, respectively. Consequently,
profits from these businesses have been, and can continue to be, impacted by fluctuations in the value of these currencies relative to U.S. dollars. When practical, we use various types of currency hedges to reduce the economic impact of currency
fluctuations.

OUTLOOK

Our strategy is to continue to grow by capitalizing on opportunities in the food business including private-brand food products and other regional and value-brand food products in the grocery, mass
merchandise, drugstore and foodservice channels. In the past few years, we have taken substantial steps to reshape our business and achieve sufficient scale in the categories in which we operate. We expect to continue to improve through volume and
profit growth of existing businesses, as well as through acquisitions or strategic alliances. We will continue to explore those acquisition opportunities that strategically fit with our intention to be a leading provider of high value private brand
foods, such as the October 3, 2011 acquisition of the North American private brand refrigerated dough business of Sara Lee Corp. The following paragraphs discuss significant trends that we believe will impact future results.

On July 14, 2011, we announced that our Board of Directors agreed in principle to separate Ralcorp and Post Foods (the Branded
Cereal Products segment) in a tax-free spin-off to Ralcorp shareholders. We expect to complete the separation in the first half of fiscal 2012, pending the receipt of an Internal Revenue Service tax ruling and opinion of legal counsel and
satisfaction of other customary conditions. Though we will receive cash in the transaction, the Company will no longer benefit from the cash flows of Posts operations thereafter.

As previously mentioned, in October 2011, we completed the acquisition of the North American
private brand refrigerated dough business from Sara Lee Corp. Results for this business will be included within our Frozen Bakery Products segment from the date of acquisition. We currently expect that the refrigerated dough business will add
approximately $340 in net sales to our consolidated fiscal 2012 results and will increase diluted earnings per share for fiscal 2012 by approximately $.30, including synergies but before one-time transition costs.

We purchase significant quantities of certain ingredients (e.g., wheat flour, durum wheat for pasta, soybean oil, corn syrup and
sweeteners, peanuts and various tree nuts, other grain products, cocoa, fruits), packaging materials (e.g., resin, glass, paper products), energy (e.g., natural gas), and transportation services (which include surcharges based on the price of diesel
fuel). The costs of some of these items, notably wheat, durum wheat, corn products, cashews, peanuts, sugar, and packaging materials have increased significantly compared to values realized in fiscal 2010. For fiscal 2012, we currently expect the
net year-over-year increase in unit costs for ingredients and packaging will result in a 10-12% increase in cost of goods sold. Excluding durum wheat and snack nuts, we expect this increase will be 5-6% after the effects of hedging and forward
purchase contracts. To offset the impact of these significant cost increases, we expect to take additional actions, including aggressively reducing costs through ongoing continuous improvement and other initiatives and increasing prices when
justified. The timing of these pricing actions and acceptance by our customers is expected to lag our cost increases, particularly in the first quarter of fiscal 2012.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The following discussion is
presented pursuant to the United States Securities and Exchange Commissions Financial Reporting Release No. 60, Cautionary Advice Regarding Disclosure About Critical Accounting Policies. The policies below are both important
to the representation of the Companys financial condition and results and require managements most difficult, subjective or complex judgments.

Under generally accepted accounting principles in the United States, we make estimates and assumptions that impact the reported amounts of assets, liabilities, revenues, and expenses as well as the
disclosure of contingent liabilities. We base estimates on past experience and on various other assumptions that are believed to be reasonable under the circumstances. Those estimates form the basis for making judgments about carrying values of
assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

Revenue is recognized when title of goods is transferred to the customer, as specified by the shipping terms. Net sales reflect gross sales, including amounts billed to customers for shipping and
handling, less sales discounts and allowances (including promotional price buy downs and new item promotional funding). Products are generally sold with no right of return except in the case of goods which do not meet product specifications or are
damaged. If additional rights of return are granted, revenue recognition is deferred. We record estimated reductions to revenue for customer incentive offerings based upon specific program offerings and each customers redemption history. If
specific program volumes exceed planned amounts or a greater proportion of customers redeem incentives than estimated, additional reductions to revenue may be required.

Inventories are generally valued at the lower of average cost (determined on a first-in, first-out basis) or market value and have been reduced by an allowance for obsolete product and packaging
materials. The estimated allowance is based on a review of inventories on hand compared to estimated future usage and sales. If market conditions and actual demands are less favorable than projected, additional inventory write-downs may be required.

We review long-lived assets, including leasehold improvements, property and equipment, and amortized intangible assets for
impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable. Long-lived assets to be disposed of are reported at the lower of the carrying amount or fair value less the
cost to sell.

Trademarks with indefinite lives are reviewed for impairment during the fourth quarter of each fiscal year
following the annual forecasting process, or more frequently if facts and circumstances indicate the trademark may be impaired. The trademark impairment tests require us to estimate the fair value of the trademark and compare it to its carrying
value. The estimated fair value is determined using an income-based approach (the relief-from-royalty method), which requires significant assumptions for each brand, including estimates regarding future revenue growth, discount rates, and
appropriate royalty rates. In our recent tests, we assumed discount rates ranging from 9% to 10% and royalty rates ranging from 0% to 8% based on consideration of several factors for each brand, including profit levels, research of external royalty
rates by third party experts, and the relative importance of each brand to the Company. Revenue growth assumptions are based on historical trends and managements expectations for future growth by brand. The discount rate is based on industry
market data of similar companies, and includes factors such as the weighted average cost of capital, internal rate of return, and weighted average return on assets. The failure in the future to achieve revenue growth rates, an increase in the
discount rate, or a significant change in the trademark profitability and corresponding royalty rate assumed would likely result in the recognition of a trademark impairment loss.

In June 2011, a trademark impairment loss of $32.1 million was recognized related to the
Post Shredded Wheat and Grape-Nuts trademarks based on reassessments triggered by the announced separation of Post from Ralcorp. The trademark impairment was due to reductions in anticipated future sales as a result of competition, lack of consumer
response to advertising and promotions for these brands, and further reallocations of advertising and promotion expenditures to higher-return brands. These factors, particularly the lower than expected revenues during 2011 and further declines in
market share, led us to lower royalty rates for both the Shredded Wheat and Grape-Nuts brands as well as further reduce future sales growth rates, resulting in a partial impairment of both brands.

Based upon a preliminary review of the Post business conducted by the newly appointed Post management team in October, sales declines in
the fourth quarter and continuing into October, and weakness in the branded ready-to-eat cereal category and the broader economy, management determined that additional strategic steps were needed to stabilize the business and the competitive
position of its brands. The impact of these steps was a reduction of expected net sales growth rates and profitability of certain brands in the near term. Consequently, an additional trademark impairment loss of $106.6 million was recognized in the
quarter ended September 30, 2011, primarily related to the Honey Bunches of Oats, Post Selects, and Post trademarks. Holding all other assumptions constant, if the discount rate had been one-quarter percentage point higher, if the sales growth
rates for each period had been one-quarter percentage point lower, or if the royalty rates had been one-quarter percentage point lower, the impairment of all indefinite-lived trademarks at September 30, 2011 would have been $22 million to $53
million higher. Excluding the five brands with related impairment charges in September 2011, each of our other material indefinite-lived trademarks had estimated fair values which exceeded their carrying values by at least 10% with the exception of
the Grape-Nuts trademark which had an estimated fair value approximately equal to its carrying value.

As noted above,
assessing the fair value of indefinite lived trademarks for our Branded Cereal Products segment includes, among other things, making key assumptions for estimating revenue growth rates and profitability (and corresponding royalty rates) by brand.
These assumptions are subject to a high degree of judgment and complexity. We make every effort to estimate revenue growth rates and profitability by brand as accurately as possible with the information available at the time the forecast is
developed. However, changes in the assumptions and estimates may affect the estimated fair value of the individual trademark, and could result in additional impairment charges in future periods. Factors that have the potential to create variances in
the estimated fair value of each trademark include but are not limited to (i) fluctuations in forecasted sales volumes, which can be driven by multiple external factors affecting demand, including macroeconomic factors, competitive dynamics in the
ready-to-eat cereal category, changes in consumer preferences, and consumer responsiveness to our promotional and advertising activities; (ii) product costs, particularly commodities such as wheat, corn, rice, sugar, nuts, oats, corrugated packaging
and diesel, and other production costs which could negatively impact profitability and corresponding royalty rate; and (iii) interest rate fluctuations and the overall impact of these changes on the appropriate discount rate.

Goodwill represents the excess of the cost of acquired businesses over the fair market value of their identifiable net assets. In the
fourth quarter of fiscal 2011, we early adopted ASU No. 2011-8 Intangibles  Goodwill and Other (Topic 350): Testing Goodwill for Impairment. We conduct a goodwill impairment qualitative assessment during the fourth quarter of
each fiscal year following the annual forecasting process, or more frequently if facts and circumstances indicate that goodwill may be impaired. The goodwill impairment qualitative assessment requires us to perform an assessment for each reporting
unit to determine if it is more likely than not that the fair value of a reporting unit is less than its carrying amount. The qualitative assessment considers various factors for each reporting unit, including the macroeconomic environment, industry
and market specific conditions, financial performance, cost impacts, and issues or events specific to the reporting unit. If adverse qualitative trends are identified that could negatively impact the fair value of the business, we perform a
step one goodwill impairment test. The step one goodwill impairment test requires us to estimate the fair value of our businesses and certain assets and liabilities. The estimated fair value was determined using a combined
income and market approach with a greater weighting on the income approach (75% of the calculation). The income approach is based on discounted future cash flows and requires significant assumptions, including estimates regarding future revenue,
profitability, and capital requirements. The market approach (25% of the calculation) is based on a market multiple (EBITDA and revenue or just EBITDA, which stands for earnings before interest, income taxes, depreciation, and amortization) and
requires an estimate of appropriate multiples for each reporting unit based on market data.

As a result of the announcement
on July 14, 2011 that the board of directors had approved an agreement in principal to separate Post Foods and Ralcorp in a tax-free spin-off to Ralcorp shareholders, we initiated and completed impairment tests on Post intangible assets earlier
than our normal (fourth quarter) annual testing process would require and prior to filing our third quarter Form 10-Q. While two Post trademarks were impaired as a result of a reduction in revenue growth rates for those brands as described above,
goodwill of our Post Foods reporting unit was not impaired because its estimated fair value exceeded its carrying value by approximately 5%.

In late September and October 2011, a new management team was named at Post (including William Stiritz as Chief Executive Officer, Robert Vitale as Chief Financial Officer, and James Holbrook as Executive
Vice President of Marketing) in advance of the anticipated spin-off of the business from Ralcorp. The new management team conducted an extensive business review of Post during this time.

The revised business outlook of the new Post management team (as described in the discussion of the trademark impairment loss for the
quarter ended September 30, 2011, above) triggered an additional step one goodwill impairment analysis. Because Posts carrying value was determined to be in excess of its fair value in our step one analysis, we were required
to perform step two of the impairment analysis to determine the amount of goodwill impairment to be recorded. The amount of the impairment is calculated by comparing the implied fair value of the goodwill to its carrying amount, which
requires us to allocate the fair value determined in the step one analysis to the individual assets and liabilities of the reporting unit. Any remaining fair value would represent the implied fair value of goodwill on the testing date. Based on the
step two analysis, we recorded a pre-tax, non-cash impairment charge of $364.8 million to reduce the carrying value of goodwill.

As of September 30, 2011, the fair value of all reporting units except Post Foods (the
Branded Cereal Products segment) exceeded their carrying value by a significant amount based on the most recent step one impairment analysis completed. The Branded Cereal Products segment had a revised goodwill balance of $1,429.2 million. For the
calculation of fair value of the Post Foods reporting unit, we assumed future revenue growth rates ranging from 0.6% to 3.3% with a long-term (terminal) growth rate of 3% and applied a discount rate of 8.5% to cash flows. Revenue growth assumptions
(along with profitability and cash flow assumptions) were based on historical trends for the reporting unit and managements expectations for future growth. The discount rate was based on industry market data of similar companies, and included
factors such as the weighted average cost of capital, internal rate of return, and weighted average return on assets. For the market approach, we used a weighted average multiple of 10.0 and 8.5 times projected fiscal 2012 and 2013 EBITDA,
respectively, and a multiple of 2.4 and 2.0 times projected fiscal 2012 and 2013 revenue, respectively, based on industry market data. An unfavorable change in forecasted operating results and cash flows, an increase in discount rates based on
changes in cost of capital (interest rates, etc.), or a decline in industry market EBITDA and revenue multiples may reduce the estimated fair value below the new carrying value and would likely result in the recognition of an additional goodwill
impairment loss. Holding all other assumptions constant, if the net sales growth rate for all future years had been one-quarter percentage point lower or the discount rate had been one-quarter percentage point higher, the goodwill impairment charge
at September 30, 2011 would have been $76 million to $122 million higher, or if the EBITDA multiple for 2012 and 2013 had been 0.5 times lower or if the revenue multiple for 2012 and 2013 had been 0.2 times lower, the impairment would have been $15
million to $24 million higher.

As noted above, assessing the fair value of goodwill for our Post Foods reporting unit
includes, among other things, making key assumptions for estimating future cash flows and appropriate industry market multiples (both EBITDA and revenue). These assumptions are subject to a high degree of judgment and complexity. We make every
effort to estimate future cash flows as accurately as possible with the information available at the time the forecast is developed. However, changes in the assumptions and estimates may affect the estimated fair value of goodwill, and could result
in additional impairment charges in future periods. Factors that have the potential to create variances in the estimated fair value of goodwill include but are not limited to (i) fluctuations in forecasted sales volumes, which can be driven by
multiple external factors affecting demand, including macroeconomic factors, competitive dynamics in the ready-to-eat cereal category, and changes in consumer preferences, (ii) consumer responsiveness to our promotional and advertising activities;
(iii) product costs, particularly commodities such as wheat, corn, rice, sugar, nuts, oats, corrugated packaging and diesel, and other production costs which could negatively impact profitability; (iv) interest rate fluctuations and the overall
impact of these changes on the appropriate discount rate; and (v) changes in industry and market multiples of EBITDA and revenue.

Pension assets and liabilities are determined on an actuarial basis and are affected by the estimated market-related value of plan assets; estimates of the expected return on plan assets, discount rates,
and future salary increases; and other assumptions inherent in these valuations. We annually review the assumptions underlying the actuarial calculations and make changes to these assumptions, based on current market conditions and historical
trends, as necessary. Actual changes in the fair market value of plan assets and differences between the actual return on plan assets and the expected return on plan assets will affect the amount of pension expense or income ultimately recognized.
The other postretirement benefits liability is also determined on an actuarial basis and is affected by assumptions including the discount rate and expected trends in healthcare costs. Changes in the discount rate and differences between actual and
expected healthcare costs will affect the recorded amount of other postretirement benefits expense. For both pensions and postretirement benefit calculations, the assumed discount rate is determined by projecting the plans expected future
benefit payments as defined for the projected benefit obligation or accumulated postretirement benefit obligation, discounting those expected payments using a theoretical zero-coupon spot yield curve derived from a universe of high-quality (rated Aa
or better by Moodys Investor Service) corporate bonds as of the measurement date, and solving for the single equivalent discount rate that results in the same present value. A 1% decrease in the assumed discount rate (from 5.4% to 4.4%) would
have increased the recorded benefit obligations at September 30, 2011 by approximately $41 million for pensions and approximately $24 million for other postretirement benefits. The expected return on plan assets was determined based on
historical and expected future returns of the various asset classes, using the target allocations of the plans. A 1% decrease in the assumed return on plan assets (from 8.75% to 7.75%) would have increased the net periodic benefit cost for the
pension plans by approximately $4 million. See Note 17 in Item 8 for more information about pension and other postretirement benefit assumptions.

Stock-based compensation cost is measured at the grant date based on the value of the award and is recognized as expense over the vesting period for awards expected to vest. Determining the fair value of
share-based awards at the grant date requires judgment, including estimating the expected term, expected stock price volatility, risk-free interest rate, and expected dividends. In addition, judgment is required in estimating the amount of
share-based awards that are expected to be forfeited before vesting. For equity awards, the original estimate of the grant date fair value is not subsequently revised unless the awards are modified, but the estimate of expected forfeitures is
revised throughout the vesting period and the cumulative stock-based compensation cost recognized is adjusted accordingly. For liability awards, the fair value is remeasured at the end of each reporting period. See Note 19 in Item 8 for more
information about stock-based compensation and our related estimates.

Until June 2009, we accounted for our investment in
Vail Resorts, Inc using the equity method of accounting because Ralcorp had significant influence. When the forward sale contracts related to shares of Vail common stock were settled in June 2009, we no longer had significant influence and accounted
for our investment as available for sale securities until September 2009, when all shares had been sold. Until the forward sale contracts were settled, they were marked to fair value based on the Black-Scholes valuation model and any gains or losses
on the contracts were immediately recognized in earnings. Key assumptions used in the valuation included the Vail stock price, expected stock price volatility, and the risk-free interest rate. See Note 6 and Note 7 in Item 8 for more
information about the investment in Vail and Vail forward sale contracts.

We estimate income tax expense based on taxes in
each jurisdiction. We estimate current tax exposures together with temporary differences resulting from differing treatment of items for tax and financial reporting purposes. These temporary differences result in deferred tax assets and liabilities.
We believe that sufficient income

will be generated in the future to realize the benefit of most of our deferred tax assets. Where there is not sufficient evidence that such income is likely to be generated, we establish a
valuation allowance against the related deferred tax assets. We are subject to periodic audits by governmental tax authorities of our income tax returns. These audits generally include questions regarding our tax filing positions, including the
amount and timing of deductions and the allocation of income among various tax jurisdictions. We evaluate our exposures associated with our tax filing positions, including state and local taxes, and record reserves for estimated exposures. As of the
end of fiscal 2011, four years (2008, 2009, 2010, and 2011, which is not yet filed) were subject to audit by the Internal Revenue Service, two to six years were subject to audit by various state and local taxing authorities, and six years (2006,
2007, 2008, 2009, 2010, and 2011, which is not yet filed) were subject to audit by the Canadian Revenue Agency and certain other foreign taxing authorities. See Note 5 for more information about estimates affecting income taxes.

ITEM 7A.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Commodity Price Risk

In the ordinary course of business, the Company is
exposed to commodity price risks relating to the acquisition of raw materials and fuels. Ralcorp utilizes derivative financial instruments, including futures contracts, options and swaps, to manage certain of these exposures when it is practical to
do so. As of September 30, 2011, a hypothetical 10% adverse change in the market price of the Companys principal hedged commodities, including natural gas, linerboard, heating oil, soybean oil, corn and wheat, would have decreased the
fair value of the Companys commodity-related derivatives portfolio by approximately $14.0 million. As of September 30, 2010, a hypothetical 10% adverse change in the market price of the Companys principal hedged commodities,
including natural gas, linerboard, heating oil, soybean oil, corn and wheat, would have decreased the fair value of the Companys commodity-related derivatives portfolio by approximately $5.5 million. This volatility analysis ignores changes in
the exposures inherent in the underlying hedged transactions. Because the Company does not hold or trade derivatives for speculation or profit, all changes in derivative values are effectively offset by corresponding changes in the underlying
exposures. For more information, see Note 1 and Note 13 to the financial statements included in Item 8.

Interest Rate Risk

The Company has interest rate risk related to its debt. Changes in interest rates impact fixed and variable rate debt
differently. For fixed rate debt, a change in interest rates will only impact the fair value of the debt, whereas a change in the interest rates on variable rate debt will impact interest expense and cash flows. At September 30, 2011,
Ralcorps financing arrangements included $1,970.2 million of fixed rate debt and $229.9 million of variable rate debt.

As of September 30, 2011 and 2010, the fair value of the Companys fixed rate debt was approximately $2070.1 million and
$2,399.5 million, respectively, based on the discounted amount of future cash flows using Ralcorps incremental rate of borrowing for similar debt. A hypothetical 10% decrease in interest rates would have increased the fair value of the fixed
rate debt by approximately $92.2 million and $89.3 million at September 30, 2011 and 2010, respectively. With respect to variable rate debt, a hypothetical 10% change in interest rates would not have had a material impact on the Companys
reported net earnings or cash flows in fiscal 2011 or 2010.

For more information, see Note 1, Note 13, and Note 15 to the
financial statements included in Item 8.

Foreign Currency Risk

The Company has foreign currency exchange rate risk related to its foreign subsidiaries, whose functional currencies are the Canadian
dollar or the Euro. The Company uses foreign exchange forward contracts to hedge the risk of fluctuations in future cash flows and earnings related to fluctuations in the exchange rate between the Canadian dollar and U.S. dollar. A hedging offset is
accomplished because the gain or loss on the forward contracts occurs on or near the date of the anticipated hedged transactions. As of September 30, 2011, the Company held foreign exchange forward contracts with a total notional amount of
$83.3 million and a fair value of negative $4.2 million. A hypothetical 10% increase in the expected CAD-USD exchange rates would have reduced that fair value by $7.1 million. As of September 30, 2010, the Company held foreign exchange forward
contracts with a total notional amount of $69.5 million and a fair value of $1.4 million. A hypothetical 10% increase in the expected CAD-USD exchange rates would have reduced that fair value by $6.6 million. For more information, see Note 1 and
Note 13 to the financial statements included in Item 8.

Management of Ralcorp Holdings,
Inc. is responsible for the fairness and accuracy of the consolidated financial statements. The statements have been prepared in accordance with accounting principles generally accepted in the United States, and in the opinion of management, the
financial statements present fairly the Companys financial position, results of operations and cash flows.

Management
has established and maintains accounting and internal control systems that it believes are adequate to provide reasonable assurance that assets are safeguarded against loss from unauthorized use or disposition and that the financial records are
reliable for preparing financial statements. The selection and training of qualified personnel, the establishment and communication of accounting and administrative policies and procedures and our Standards of Business Conduct for Officers and
Employees are important elements of these control systems. We maintain a strong internal audit program that independently evaluates the adequacy and effectiveness of internal controls. Appropriate actions are taken by management to correct any
control weaknesses identified in the audit process.

The Board of Directors, through its Audit Committee consisting solely of
independent directors, meets periodically with management and the independent registered public accounting firm to discuss internal control, auditing and financial reporting matters. To ensure independence, PricewaterhouseCoopers LLP has direct
access to the Audit Committee.

The Audit Committee reviewed and approved the Companys annual financial statements and
recommended to the full Board of Directors that they be included in the Annual Report.

MANAGEMENTS REPORT ON INTERNAL
CONTROL OVER FINANCIAL REPORTING

Management of Ralcorp Holdings, Inc. is responsible for establishing and maintaining
adequate internal control over financial reporting, as defined in Rule 13a-15(f) of the Securities Exchange Act of 1934. Under the supervision and with the participation of management, including the Co-Chief Executive Officers and Chief Accounting
Officer, we conducted an evaluation of the effectiveness of our internal controls over financial reporting based on the criteria established in Internal Control  Integrated Framework issued by the Committee of Sponsoring Organizations
of the Treadway Commission. Based on the evaluation under this framework, management concluded that our internal control over financial reporting was effective as of September 30, 2011 at the reasonable assurance level. The effectiveness of our
internal control over financial reporting as of September 30, 2011 has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report (on the following page).

In our opinion, the accompanying consolidated balance sheets and the related consolidated statements of operations, of cash flows, and of shareholders equity present fairly, in all material
respects, the financial position of Ralcorp Holdings, Inc. and its subsidiaries at September 30, 2011 and 2010, and the results of their operations and their cash flows for each of the three years in the period ended September 30, 2011 in conformity
with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of September 30, 2011, based on criteria
established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Companys management is responsible for these financial statements, for maintaining
effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Managements Report on Internal Control over Financial Reporting. Our
responsibility is to express opinions on these financial statements and on the Companys internal control over financial reporting based on our integrated audits. We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control
over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting
principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial
reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we
considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

As
discussed in Note 2 to the consolidated financial statements, the Company changed the manner in which it accounts for the sale of its accounts receivable in 2011.

A companys internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted accounting principles. A companys internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that,
in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance
regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the companys assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections
of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Basis of Consolidation  The financial statements are presented on a consolidated
basis and include the accounts of Ralcorp and its majority-owned subsidiaries, except Ralcorp Receivables Corporation prior to fiscal 2011 (see Note 11). All significant intercompany transactions have been eliminated. The Companys investment
in Vail Resorts, Inc. was presented on the equity basis through June 2009 (see Note 6).

Estimates  The
financial statements have been prepared in conformity with generally accepted accounting principles, which require management to make estimates and assumptions that affect reported amounts and disclosures. Actual results could differ from those
estimates and assumptions.

Cash Equivalents include all highly liquid investments with original maturities of
less than three months.

Receivables are reported at net realizable value. This value includes appropriate
allowances for doubtful accounts, cash discounts, and other amounts which the Company does not ultimately expect to collect. The Company calculates the allowance for doubtful accounts based on historical losses and the economic status of, and its
relationship with, its customers, especially those identified as at risk. A receivable is considered past due if payments have not been received within the agreed upon invoice terms. Receivables are written off against the allowance when
the customer files for bankruptcy protection or is otherwise deemed to be uncollectible based upon the Companys evaluation of the customers solvency. The Companys primary concentration of credit risk is related to certain trade
accounts receivable due from several highly leveraged or at risk customers. At September 30, 2011 and 2010, the amount of such receivables was immaterial. Consideration was given to the economic status of these customers when
determining the appropriate allowance for doubtful accounts (see Note 12) and the fair value of the Companys subordinated retained interest in accounts receivable (see Note 11).

Inventories are generally valued at the lower of average cost (determined on a first-in, first-out basis) or market.
Reported amounts have been reduced by an allowance for obsolete product and packaging materials based on a review of inventories on hand compared to estimated future usage and sales.

Derivative Financial Instruments and Hedging  The Company enters into derivative contracts as hedges. Earnings
impacts for all hedges are reported in the statement of operations within the same line item as the gain or loss on the item or transaction being hedged. Since the hedging activities relate to operations, related cash flows are included in the
statement of cash flows in cash flows from operating activities. Hedge accounting is only applied when the qualifying criteria are met, including the requirement that the derivative is deemed to be highly effective at offsetting changes in fair
values or anticipated cash flows of the hedged item or transaction and other. For a fair value hedge of a recognized asset or liability or unrecognized firm commitment, the entire change in fair value of the derivative is recorded in earnings as
incurred, along with a corresponding change in fair value of the hedged item. For a cash flow hedge of an anticipated transaction, the ineffective portion of the change in fair value of the derivative is recorded in earnings as incurred, whereas the
effective portion is deferred in accumulated other comprehensive income (loss) in the balance sheet until the transaction is realized, at which time any deferred hedging gains or losses are recorded in earnings. Certain derivative contracts do not
meet the criteria for cash flow hedge accounting or simply are not designated as hedging instruments; nonetheless, they are used as economic hedges of exposures to changes in commodity costs. Realized and unrealized gains and losses on such
contracts are recognized in earnings at a corporate level but not allocated to affect segment profit until the hedged exposure affects earnings. For more information about the Companys hedging activities, see Note 13.

Property is recorded at cost, and depreciation expense is provided on a
straight-line basis over the estimated useful lives of the properties. With a few minor exceptions, estimated useful lives are up to 15 years for machinery and equipment and up to 30 years for buildings and leasehold improvements. Leasehold
improvements are depreciated over the remaining original lease term. Total depreciation expense was $148.3, $117.5, and $102.4 in fiscal 2011, 2010, and 2009, respectively. Repair and maintenance costs incurred in connection with planned major
maintenance activities are accounted for under the direct expensing method. At September 30, property consisted of:

2011

2010

Land

$

42.1

$

42.7

Buildings and leasehold improvements

381.0

372.7

Machinery and equipment

1,455.9

1,368.5

Construction in progress

90.4

74.6

1,969.4

1,858.5

Accumulated depreciation

(774.1

)

(639.5

)

$

1,195.3

$

1,219.0

Other Intangible Assets consist of computer software purchased or developed for internal
use and customer relationships, trademarks, computer software, and miscellaneous intangibles acquired in business combinations (see Note 3). Amortization expense related to intangible assets is provided on a straight-line basis over the estimated
useful lives of the assets. For the intangible assets recorded as of September 30, 2011, amortization expense of $79.3, $70.9, $66.1, $61.3, and $56.2 is scheduled for fiscal 2012, 2013, 2014, 2015, and 2016, respectively. Other intangible
assets consisted of:

September 30, 2011

September 30, 2010

CarryingAmount

Accum.Amort.

NetAmount

CarryingAmount

Accum.Amort.

NetAmount

Subject to amortization:

Computer software

$

75.3

$

(46.2

)

$

29.1

$

66.0

$

(38.4

)

$

27.6

Customer relationships

836.9

(176.8

)

660.1

840.1

(115.9

)

724.2

Trademarks/brands

126.5

(26.6

)

99.9

126.5

(19.3

)

107.2

Other

13.1

(10.1

)

3.0

13.1

(8.2

)

4.9

1,051.8

(259.7

)

792.1

1,045.7

(181.8

)

863.9

Not subject to amortization:

Trademarks/brands

724.4



724.4

863.1



863.1

$

1,776.2

$

(259.7

)

$

1,516.5

$

1,908.8

$

(181.8

)

$

1,727.0

Recoverability of Assets  The Company continually evaluates whether events or
circumstances have occurred which might impair the recoverability of the carrying value of its assets, including property, identifiable intangibles, and goodwill. An assessment of indefinite life assets (including goodwill and brand trademarks) is
performed during the fourth quarter in conjunction with the annual forecasting process. In addition, intangible assets are reassessed as needed when information becomes available that is believed to negatively impact the fair market value of an
asset. In general, an asset is deemed impaired and written down to its fair value if estimated related future cash flows are less than its carrying amount. The Company estimates the fair value of its trademarks (intangible asset) using an
income-based approach (the relief-from-royalty method).

In September 2011, a trademark impairment loss of $106.6 was
recognized primarily related to the Post Honey Bunches of Oats, Post Selects, and Post trademarks in the Branded Cereal Products segment. Based upon a preliminary review of the Post business conducted by the newly appointed Post management team in
October, sales declines in the fourth quarter and continuing into October, and weakness in the branded ready-to-eat cereal category and the broader economy, management determined that additional strategic steps were needed to stabilize the business
and the competitive position of its brands. The impact of these steps is the reduction of expected net sales growth rates and profitability of certain brands in the near term, thereby resulting in the trademark impairment. In June 2011, a trademark
impairment loss of $32.1 million was recognized related to the Post Shredded Wheat and Grape-Nuts trademarks based on reassessments triggered by the announced separation of Post from Ralcorp. The trademark impairment was due to reductions in
anticipated future sales as a result of competition, lack of consumer response to advertising and promotions for these brands, and further reallocations of advertising and promotion expenditures to higher-return brands. These factors, particularly
the lower than expected revenues during 2011 and further declines in market share, led us to lower royalty rates for both the Shredded Wheat and Grape-Nuts brands as well as further reduce future sales growth rates, resulting in a partial impairment
of both brands.

These fair value measurements fell within Level 3 of the fair value hierarchy as described
in Note 14. The trademark impairment loss is reported in Impairment of intangible assets and, for 2011, is combined with a goodwill impairment loss. See Note 4 for information about goodwill impairments.

Investments  The Company funds a portion of its deferred compensation liability by investing in certain mutual funds
in the same amounts as selected by the participating employees. Because managements intent is to invest in a manner that matches the deferral options chosen by the participants and those participants can elect to transfer amounts in or out of
each of the designated deferral options at any time, these investments have been classified as trading assets and are stated at fair value in Other Assets. Both realized and unrealized gains and losses on these assets are included in
Selling, general and administrative expenses and offset the related change in the deferred compensation liability.

Revenue is recognized when title of goods is transferred to the customer, as specified by the shipping terms. Net sales
reflect gross sales, including amounts billed to customers for shipping and handling, less sales discounts and allowances (including promotional price buy downs, and new item promotional funding). Customer trade allowances are generally computed as
a percentage of gross sales. Products are generally sold with no right of return except in the case of goods which do not meet product specifications or are damaged, and related reserves are maintained based on return history. If additional rights
of return are granted, revenue recognition is deferred. Estimated reductions to revenue for customer incentive offerings are based upon customers redemption history.

Cost of Products Sold includes, among other things, inbound and outbound freight costs and depreciation expense related to assets used in production, while storage and other warehousing
costs are included in Selling, general, and administrative expenses. Storage and other warehousing costs totaled $144.7, $127.6, and $111.6 in fiscal 2011, 2010, and 2009, respectively.

Advertising costs are expensed as incurred except for costs of producing media advertising such as television commercials
or magazine advertisements, which are deferred until the first time the advertising takes place. The amount reported as assets on the balance sheet was insignificant as of September 30, 2011 and 2010.

Stock-based Compensation  The Company recognizes the cost of employee services received in exchange for awards of
equity instruments based on the grant-date fair value of those awards (with limited exceptions). That cost will be recognized over the period during which an employee is required to provide service in exchange for the award  the requisite
service period (usually the vesting period). The Company followed the nominal vesting period approach prior to October 1, 2005 (for pro forma disclosure purposes) and must continue following that approach for awards outstanding as of that date,
but applies the non-substantive vesting period approach to new grants that have retirement eligibility provisions. See Note 19 for disclosures related to stock-based compensation.

Income Tax Expense is estimated based on taxes in each jurisdiction and includes the effects of both current tax exposures
and the temporary differences resulting from differing treatment of items for tax and financial reporting purposes. These temporary differences result in deferred tax assets and liabilities. A valuation allowance is established against the related
deferred tax assets to the extent that it is not more likely than not that the future benefits will be realized. Reserves are recorded for estimated exposures associated with the Companys tax filing positions, which are subject to periodic
audits by governmental taxing authorities. Interest due to an underpayment of income taxes is classified as income taxes. The Company considers the undistributed earnings of its foreign subsidiaries to be permanently invested, so no U.S. taxes have
been provided for those earnings. See Note 5 for disclosures related to income taxes.

Reclassifications 
Certain prior years amounts have been reclassified to conform to the current years presentation.

In December 2007, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards (FAS) 141(R),
Business Combinations, now included in Accounting Standards Codification (ASC) Topic 805, Business Combinations, which replaces FAS 141. This Statement establishes principles and requirements for how an acquirer in a business
combination recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any controlling interest; recognizes and measures the goodwill acquired in the business combination or a gain from a
bargain purchase; and determines what information to disclose to enable users of the financial statements to evaluate the nature and financial effects of business combinations. This Statement is effective for acquisitions completed after the
beginning of Ralcorps 2010 fiscal year. The most significant change for Ralcorp was that costs incurred to effect the business combination are now expensed immediately rather than included as part of the purchase price and goodwill. Related
disclosures are included in Note 3.

In April 2008, the FASB issued FASB Staff Position (FSP) FAS 142-3, Determination
of the Useful Life of Intangible Assets, now included in ASC Topic 350, IntangiblesGoodwill and Other, which amends the factors that should be considered in developing renewal or extension assumptions used to determine the
useful life of a recognized intangible asset under FAS 142, Goodwill and Other Intangible Assets. This FSP was effective for financial statements issued for Ralcorps 2010 fiscal year. The FSPs guidance for determining the
useful life of a recognized intangible asset must be applied prospectively to intangible assets acquired after the effective date (October 1, 2009 for Ralcorp). The FSPs disclosure requirements must be applied prospectively to all intangible
assets recognized as of, and subsequent to, the effective date.

Issued in December 2009, Accounting Standards Update (ASU)
No. 2009-16 amends ASC Topic 860 for the issuance of FAS 166, Accounting for Transfers of Financial Assets  an amendment of FASB Statement No. 140. The amendments in this ASU improve financial reporting by eliminating the
exceptions for qualifying special-purpose entities from the consolidation guidance and the exception that permitted sale accounting for certain mortgage securitizations when a transferor has not surrendered control over the transferred financial
assets. In addition, the amendments require enhanced disclosures about the risks that a transferor continues to be exposed to because of its continuing involvement in transferred financial assets. Comparability and consistency in accounting for
transferred financial assets will also be improved through clarifications of the requirements for isolation and limitations on portions of financial assets that are eligible for sale accounting. Also issued in December 2009, ASU 2009-17 amends ASC
Topic 810, Consolidations, for the issuance of FAS 167, Amendments to FASB Interpretation No. 46(R). The amendments in this ASU replace the quantitative-based risks and rewards calculation for determining which reporting
entity, if any, has a controlling financial interest in a variable interest entity with an approach focused on identifying which reporting entity has the power to direct the activities of a variable interest entity that most significantly impact the
entitys economic performance and (1) the obligation to absorb losses of the entity or (2) the right to receive benefits from the entity. An approach that is expected to be primarily qualitative will be more effective for identifying
which reporting entity has a controlling financial interest in a variable interest entity. The amendments in this ASU also require additional disclosures about a reporting entitys involvement in variable interest entities, which will enhance
the information provided to users of financial statements. These ASUs were effective for Ralcorps 2011 fiscal year and affected the Companys reporting related to its sale of accounts receivable (see Note 11). Beginning in fiscal 2011,
the outstanding balance of receivables sold ($247.1 and $137.8 at September 30, 2011 and 2010, respectively) remains on Ralcorps consolidated balance sheet, proceeds received from the conduits ($105.0 and zero as of September 30, 2011 and
2010, respectively) is shown as short-term debt, and there is no investment in Ralcorp Receivables Corporation. In addition, any proceeds received from or repaid to the conduits is now shown as cash flows from financing activities rather than from
operating activities.

In May 2011, the FASB issued ASU No. 2011-04, Fair Value Measurement (Topic 820): Amendments
to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS. This update establishes common requirements for measuring fair value and for disclosing information about fair value measurements in accordance with
U.S. generally accepted accounting principles (GAAP) and International Financial Reporting Standards (IFRS). The amendments in this update are effective during interim and annual periods beginning after December 15, 2011 (i.e., Ralcorps
financial statements for the quarter ending March 31, 2012). The adoption of this update is not expected to have a material effect on the Companys financial position, results of operations or cash flows.

In June 2011, the FASB issued ASU No. 2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive Income.
The objective of this update is to improve the comparability, consistency, and transparency of financial reporting to increase the prominence of items reported in other comprehensive income. This update requires that all nonowner changes in
shareholders equity be presented in either a single continuous

statement of comprehensive income or in two separate but consecutive statements. The amendments in this update are effective for fiscal years, and interim periods within those years beginning
after December 15, 2011 (i.e., Ralcorps financial statements for the quarter ending December 31, 2012). The adoption of this update is not expected to have a material effect on the Companys financial position, results of operations
or cash flows.

In September 2011, the FASB issued ASU No. 2011-8, Intangibles  Goodwill and Other (Topic
350): Testing Goodwill for Impairment, which is intended to simplify how an entity tests goodwill for impairment. The amendments in this ASU will allow an entity to first assess qualitative factors to determine whether it is necessary to
perform the two-step quantitative goodwill impairment test. An entity no longer will be required to calculate the fair value of a reporting unit unless the entity determines, based on a qualitative assessment, that it is more likely than not that
its fair value is less than its carrying amount. The guidance also includes examples of the types of factors to consider in conducting the qualitative assessment. Prior to this ASU, entities were required to test goodwill for impairment, on at least
an annual basis, by first comparing the fair value of a reporting unit with its carrying amount, including goodwill. If the fair value of a reporting unit is less than its carrying amount, then the second step of the test is to be performed to
measure the amount of impairment loss, if any. The amendments must be adopted for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011; however, the Company chose to adopt this ASU as of
September 30, 2011, as permitted by the standard. See Note 4 for information about goodwill impairments.

In September
2011, the FASB issued ASU No. 2011-9, Compensation  Retirement Benefits  Multiemployer Plans (Subtopic 715-80): Disclosures about an Employers Participation in a Multiemployer Plan, which provides new requirements
for the disclosures that an employer should provide related to its participation in multiemployer pension plans. Plans of this type are commonly used by employers to provide benefits to union employees that may work for multiple employers during
their working life and thereby accrue benefits in one plan for their retirement. The revised disclosures will provide users of financial statements with additional information about the plans in which an employer participates, the level of an
employers participation in the plans, and financial health of significant plans. The amendments in this update are effective for Ralcorps annual financial statements for the year ending September 30, 2012.

NOTE 3  BUSINESS COMBINATIONS

Each of the following acquisitions was accounted for using the purchase method of accounting, whereby the results of operations of each of the following acquisitions are included in the consolidated
statements of operations from the date of acquisition. The purchase price, including acquisition costs for acquisitions before 2010, was allocated to acquired assets and liabilities based on their estimated fair values at the date of acquisition,
and any excess was allocated to goodwill, as shown in the following table. For each acquisition, the goodwill is attributable to the assembled workforce of the acquired business and the significant synergies and opportunities expected from the
combination of the acquired business with existing Ralcorp businesses.

The following table summarizes the provisional amounts recognized related to fiscal 2010
acquisitions as of September 30, 2010, as well as adjustments made in the year ended September 30, 2011. The adjustments did not have a significant impact on the consolidated statements of income, balance sheets or cash flows in any
period; therefore, the financial statements have not been retrospectively adjusted.

AcquisitionDate AmountsRecognized as ofSeptember 30, 2010
(a)

AdjustmentsDuring theYear
EndedSeptember 30, 2011

AcquisitionDate AmountsRecognized(as Adjusted)

Cash

$

41.1

$



$

41.1

Receivables (b)

53.7

.7

54.4

Inventories (c)

55.6

(.2

)

55.4

Other current assets (b)

22.2

(.2

)

22.0

Property (d)

306.1

1.6

307.7

Goodwill

577.4

11.5

588.9

Other intangible assets (c)

612.9

(2.0

)

610.9

Other assets (b)

.6

.5

1.1

Total assets acquired

1,669.6

11.9

1,681.5

Accounts payable

(35.6

)



(35.6

)

Other current liabilities (b)

(31.1

)

(.1

)

(31.2

)

Deferred income taxes (e)

(243.1

)

(11.8

)

(254.9

)

Other liabilities

(6.2

)



(6.2

)

Total liabilities assumed

(316.0

)

(11.9

)

(327.9

)

Net assets acquired

$

1,353.6

$



$

1,353.6

(a)

As previously reported in Ralcorps 2010 Annual Report on Form 10-K.

(b)

The adjustments to Receivables, Other current assets, Other assets, and Other current liabilities reflect the
identification and adjustment of unrecorded AIPC and Sepps Gourmet Foods assets or liabilities at the acquisition date.

(c)

The adjustments to Inventories and Other intangible assets reflect changes in the estimated fair value of AIPCs inventories and customer
relationships based on the valuation analyses finalized late in the first quarter of fiscal 2011.

(d)

The adjustments to Property reflect changes in the estimated fair values for AIPC (increase of $1.5) and Sepps Gourmet Foods (increase of $.1) based
on the analyses finalized late in the first quarter of fiscal 2011.

(e)

The adjustment to Deferred income taxes was the result of revised estimates of the estimated AIPC blended state tax rate and the amount of certain temporary
income tax differences as of the acquisition date.

Fiscal 2010

On May 31, 2010, the Company acquired J.T. Bakeries Inc., a leading manufacturer of high-quality private-brand and co-branded gourmet
crackers in North America, and North American Baking Ltd., a leading manufacturer of premium private-brand specialty crackers in North America. These businesses operate plants in Kitchener and Georgetown, Ontario and are included in Ralcorps
Snacks, Sauces & Spreads segment. On June 25, 2010, the Company acquired Sepps Gourmet Foods Ltd., a leading manufacturer of foodservice and private-brand frozen griddle products. Sepps has operations in Delta, British
Columbia and is included in Ralcorps Frozen Bakery Products segment. Net sales and operating profit included in the statement of operations related to these three acquisitions were $138.0 and $6.6, respectively, for the year ended
September 30, 2011 and $46.6 and $2.0, respectively, for the year ended September 30, 2010. Operating profit is net of amortization expense totaling $4.1 in 2011 and $1.2 in 2010. The related goodwill is not deductible for tax purposes.

On July 27, 2010, the Company completed the purchase of American Italian Pasta Company (AIPC), which is reported as
Ralcorps Pasta segment. Ralcorp acquired all of the outstanding shares of AIPC common stock for $53.00 per share in cash. The related goodwill is not deductible for tax purposes. AIPC is based in Kansas City, Missouri and has four plants that
are located in Columbia, South Carolina; Excelsior Springs, Missouri; Tolleson, Arizona; and Verolanuova, Italy. Acquired identifiable intangible assets consist of $372.2 of customer relationships with a weighted-average life of 16 years and $193.0
of trademarks of which $180.8 have indefinite lives and $12.2 have a weighted-average life of 15 years. Finished goods inventory acquired in the acquisition was valued essentially as if Ralcorp were a distributor purchasing the inventory. This
resulted in a one-time allocation of purchase price to acquired inventory which was $3.9 higher than the historical manufacturing cost of the inventory. All of the $3.9 inventory valuation adjustment was recognized in cost of products sold during
fiscal 2010.

In a cash transaction on March 20, 2009, the Company acquired Harvest Manor Farms, LLC, a leading manufacturer of high-quality private-brand and Hoodys branded snack nuts with operations in El
Paso, TX. The approximate amounts of net sales and operating profit included in Ralcorps results (within its Snacks, Sauces & Spreads segment) were $246.8 and $17.5, respectively, for fiscal 2011, $210.8 and $13.2, respectively, for
fiscal 2010 and $90.5 and $5.5, respectively, for fiscal 2009. The assigned goodwill is deductible for tax purposes. Other intangible assets included customer relationships and trademarks subject to amortization over a weighted average amortization
period of approximately 13 years.

Merger and Integration Costs

During the years ended September 30, 2011, 2010, and 2009, the Company recorded $2.5, $33.1, and $32.0, respectively, of expenses
related to recent or potential acquisitions. In fiscal 2011, those expenses included primarily service fees related to the acquisition of Sara Lees North American refrigerated dough business, completed on October 3, 2011. In fiscal 2010,
those expenses included professional services fees and a finished goods inventory revaluation adjustment related to the AIPC transaction, Post Foods transition and integration costs, and severance costs related to all four fiscal 2010 acquisitions.
In fiscal 2009, those expenses included Post Foods transition and integration costs, as well as finished goods inventory revaluation adjustments related to the acquisitions in those years. These merger and integration costs were included in the
statements of operations as follows:

2011

2010

2009

Cost of goods sold

$



$

5.2

$

2.5

Selling, general and administrative expenses

.6

6.4

29.5

Other operating expenses, net

1.9

21.5



$

2.5

$

33.1

$

32.0

Pro Forma Information

The following unaudited pro forma information shows Ralcorps results of operations as if the fiscal 2010 and 2009 business combinations had all been completed as of the beginning of each period
presented. The acquirees pre-acquisition results have been added to Ralcorps historical results, and the totals have been adjusted for the pro forma effects of amortization of intangible assets recognized as part of the business
combination, interest expense related to the financing of the business combinations, and related income taxes. These pro forma results may not necessarily reflect the actual results of operations that would have been achieved, nor are they
necessarily indicative of future results of operations.